The Plan Is W

orthless If You Don't Act Before December 31We've spent all month planning. You set your goal from the life you want. You ran the Business Model Math to see what it takes. You checked whether your practice can carry it at a sane 80%. Good work.

Here's the hard truth about all of it. A plan you don't act on is just a wish with better formatting.

And right now, in late October, you're sitting on a window that is about to slam shut. A whole category of money moves has a hard deadline, December 31, and after that they're gone for the year. Not deferred. Gone.

Planning Season and Acting Season Are the Same Season Right Now

Most owners treat planning as a thing you do, then get to the doing "later." In the fourth quarter, there is no later. The calendar is the deadline. Whatever you want to count for this tax year has to happen before the ball drops, and whatever you want to hit the ground running on January 1 has to be decided before the holidays bury you.

You have about two months, and November and December are shorter than they look once the holidays start eating them.

What Closes on December 31

I'm not going to re-teach the tax mechanics, we covered that earlier this fall. I'm going to name the moves that have a clock on them, so you can go run the ones that fit your situation with your advisor.

• Equipment. If you want to deduct that purchase this year, it has to be bought and placed in service by December 31. Not on order. In service.

• Retirement plans. Trickier than most year-end lists admit. A lot of the funding can wait until your tax deadline next year, but some pieces, like deferrals that run through payroll, have to happen during the year. Worth planning now even if the dollars go in later.

• Owner compensation and distributions. For S corporation owners especially, payroll and reasonable comp have to run inside the calendar year. December is your last chance to true it up and lock in this year's payroll tax savings.

• Your final estimated payment. We talked about this in September. With the year almost complete, now is when you true up what you owe instead of guessing.

• The rest of your year-end tax moves. Most of the strategies worth considering only work if they're executed in the calendar year you're trying to affect.

None of these wait for you. The date is fixed.

The Other Deadline Nobody Sets

There's a second thing to finish before December 31, and it has nothing to do with taxes. Your plan for next year.

All that work you did this month, the goal, the math, the capacity, finish it now, while it's fresh, so that on January 1 you're executing instead of still deciding. The owners who have their best years don't spend January figuring out what the year is about. They start already in motion, because they did the thinking in October and November.

A plan finished in February is a plan that cost you two months of the year.

Planning With Purpose Means Acting With Urgency

A few weeks ago I told you a shocking tax bill is a timing failure, not a tax failure. Same lesson, bigger scope. The best plan in the world produces nothing if you sit on it past the window.

The owners who get ahead aren't the ones with the prettiest plan. They're the ones who pull the trigger while there's still time on the clock. So block the time. In the next two weeks, before the holidays take over, sit down and do two things. Run your year-end moves. Lock your plan for next year. Not in January. Now.

Want Help Running Your Year-End Moves?

If you want a second set of eyes on your year-end tax moves and next year's plan while there's still time to act, let's do it. Click here to Book Your Financial Clarity Call and we'll make sure nothing valuable slips past December 31.

To your abundant practice,

Eric Levenhagen, CPA CTS

Eric Levenhagen, CPA CTS, is the only financial consultant who helps private practice optometrists improve the financial health of their practice with a simple process called Financial Harmony, designed to reduce their taxes and increase their after-tax profits so they can reach their personal goals faster.

ProWise Tax & Accounting LLC Disclaimer: This blog is intended for educational purposes and provides general information about tax, accounting, and small business topics. It is not professional advice, and using this blog does not create a client/CPA relationship between you and ProWise Tax & Accounting, LLC dba ProWise Financial Consulting, or its owners and employees. Blog posts are based on tax rules in effect at the time they are written, and older posts are not always updated for changes. Tax rules change frequently. Always check with your CPA or accountant regarding the most current rules and how they apply to your specific situation.