Take Full Advantage of Retirement Savings Opportunities

Retirement plans remain one of the most powerful tax-saving tools available to small-business owners and self-employed professionals.

Establish or Fund a Retirement Plan Before Year-End

If you don’t yet have a retirement plan, setting one up before December 31 allows you to make both employee and employer contributions for 2025.

For a solo business, a 401(k) plan (often referred to as an “individual 401(k)” or a “solo 401(k)”) is an ideal option. Your owner-employee contribution limits for 2025 are:

• $23,500 if under age 50
• $31,000 if age 50–59 or over 64
• $34,750 if age 60–63

Your employer contributions to your retirement account (remember, you are both employer and employee) can tally up to 25 percent of compensation, with a combined maximum of $70,000–$81,250 depending on age.

Use Available Tax Credits

If you started a new plan this year or plan to, you may qualify for valuable credits:

1. A start-up credit of up to $15,000 for new plans
2. A contribution credit of up to $3,500 per employee for employer contributions
3. An automatic-enrollment credit of $500 per year for three years

These credits directly reduce taxes owed, not just taxable income.

Consider a Roth Conversion

If your income is lower this year or your investments have declined, converting a traditional IRA or 401(k) to a Roth can be an attractive option. You’ll pay tax on the converted amount now, but future qualified withdrawals are tax-free, and Roth IRAs have no required minimum distributions during your lifetime. 

How We Can Help

Sterling Tax and Accounting is here to help your business with tax planning! Our comprehensive approach to tax planning helps reduce your overall tax liability and keep more money in your pocket. If all your accountant does is file your taxes, chances are they are making you pay more than your fair share of taxes.

Learn how to proactively save on taxes by scheduling a call with our tax planning specialists.

Our tax planning, accounting & business services help you stay on track. Sterling Tax & Accounting will work with you to optimize your business and minimize your taxes. We will work to provide you and your business with the tools and resources you need to build a solid tax and business foundation. We’re a trusted CPA Firm in Sarasota, Florida. We serve clients all over the US, and proactively work to minimize their taxes.

Welcome to the Sterling Standard of business! Want to learn more? Schedule a meeting with our tax planning team here:
https://www.sterling.cpa/contact-us/