December marks critical deadlines for tax planning, tip reporting, IRA withdrawals, and final deductible payments for 2025. Ensuring compliance can affect financial results favorably for individuals, especially those guided by SULLIVAN & COMPANY CPA INC.’s strategic advice.

December 1 – Prepare for Year-End Tax Planning

December is pivotal for finalizing actions that will influence your 2025 tax returns. Individuals experiencing significant income variations, changes in marital status, or those engaged in property sales this year should schedule a consultation. Engaging with our expert team ensures a strategy that aligns with broader wealth preservation goals.

December 10 – Tip Income Reporting

Employees receiving more than $20 in tips for November must report these on IRS Form 4070 by December 10. Employers will adjust withholdings accordingly, reporting any uncovered tips on your W-2. Our advisory services can provide clarity on navigating both payroll and potential tax liabilities.

December 31 – Mandatory IRA Withdrawals

For those born before January 1, 1952, December 31 is the final day to withdraw from a Traditional IRA without penalty. If you reached 73 in 2025, your first tax year for required distributions is 2025, although you may defer until April 1, 2026. Plan withdrawals with your institution early to circumvent any year-end accessibility issues.

December 31 – Last Day for Deductible Payments

Ensure all deductible expenses for 2025 are completed by December 31, excluding categories like IRA, SEP, or Keogh contributions, which remain deductible into the following year. As a precaution, initiate transactions in advance due to potential financial institution closures on the last day of the year.

Weekends & Holidays:

Tax deadlines landing on weekends or holidays will automatically shift to the following business day. Planning ahead is crucial for timely compliance.

Disaster Area Extensions:

Recognized disaster zones benefit from filing extensions. Stay informed of designations and revised deadlines via FEMA and IRS online resources:
FEMA: https://www.fema.gov/disaster/declarations
IRS: https://www.irs.gov/newsroom/tax-relief-in-disaster-situations