Last-Minute Year-End Tax Tactics: Maximize Your Business Savings Now!
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As the year draws to a close, small business owners find themselves in a crucial period for financial organization and tax strategy optimization. With the potential to significantly reduce your 2025 tax bill, implementing effective tax strategies now becomes imperative. By maximizing savings, managing cash flow, and ensuring compliance with tax deadlines, you can position your business more robustly for the upcoming year. Taking decisive action before December 31 is essential. To assist you in this critical period, here’s a year-end tax planning checklist to help small businesses take control and uncover valuable tax-saving opportunities.
Buy Equipment and Other Fixed Assets:
One of the most effective ways to generate tax deductions is to buy equipment, machinery and other fixed assets needed for the business and place them in service by Dec. 31. Ordinarily these assets are capitalized and depreciated over several years, but there are a few options for deducting some or all these expenses immediately, including:
- Section 179 Expensing - This break allows you to deduct up to $2.5 million ($1.25 million if filing married separate) in expenses for qualifying tangible property and certain computer software placed in service in 2025. It’s phased out on a dollar-for-dollar basis to the extent Sec. 179 expenditures exceed $4 million.
Section 179 expensing allows businesses to immediately deduct the cost of certain qualifying property, rather than depreciating it over time. This includes tangible personal property purchased for use in an active trade or business, such as machinery, equipment, and off-the-shelf software. Certain improvements to nonresidential real property, like roofs, HVAC systems, and fire protection systems, also qualify. However, buildings and structural components generally do not qualify unless they fall under the category of "qualified real property," which includes specific leasehold, restaurant, and retail improvements. The property must be used more than 50% for business purposes and placed in service during the tax year the deduction is claimed.
- Bonus Depreciation - Bonus depreciation saw a significant enhancement due to legislative changes made by the OBBBA, which increased the depreciation rate to a full 100% for qualifying property purchased after January 19, 2025. Previously set at 40% for 2025, this change, which OBBBA made permanent, enables businesses to immediately deduct the entirety of the cost of qualifying property in the year it is placed in service, providing a powerful tax-saving tool.
Section 179 expensing allows businesses to immediately deduct the cost of certain qualifying property, rather than depreciating it over time. This includes tangible personal property purchased for use in an active trade or business, such as machinery, equipment, and off-the-shelf software. Certain improvements to nonresidential real property, like roofs, HVAC systems, and fire protection systems, also qualify. However, buildings and structural components generally do not qualify unless they fall under the category of "qualified real property," which includes specific leasehold, restaurant, and retail improvements. The property must be used more than 50% for business purposes and placed in service during the tax year the deduction is claimed.
- Bonus Depreciation - Bonus depreciation saw a significant enhancement due to legislative changes made by the OBBBA, which increased the depreciation rate to a full 100% for qualifying property purchased after January 19, 2025. Previously set at 40% for 2025, this change, which OBBBA made permanent, enables businesses to immediately deduct the entirety of the cost of qualifying property in the year it is placed in service, providing a powerful tax-saving tool.
Qualified property for bonus depreciation includes tangible personal property with a Modified Accelerated Cost Recovery System (MACRS) recovery period of 20 years or less, most computer software, certain leasehold improvements, and specific transport utility property. This depreciation benefit applies to both new and used assets acquired and placed in service after the designated date, offering businesses increased flexibility in managing their capital expenditures.
- De Minimis Safe Harbor - The de minimis safe harbor rule offers an opportunity to directly expense certain low-value items used in your business, bypassing the usual process of capitalizing and depreciating them as fixed assets. If your business maintains applicable financial statements, you can write off expenses of up to $5,000 per item or invoice for these purchases, assuming they're also expensed for accounting purposes. Without such financial statements, the cap is lowered to $2,500. Despite its "de minimis" label, this provision allows for substantial immediate deductions. For instance, purchasing ten computers at $2,500 each could enable you to claim an upfront deduction of $25,000.
Year-end Inventory Management:
Year-end inventory plays a significant role in determining a business's profit or loss as it directly affects the Cost of Goods Sold (COGS), which is a critical component of calculating gross profit.
Cost of goods sold (COGS) is calculated as the beginning inventory plus purchases during the year minus the ending inventory. Thus, the value of the ending inventory directly reduces the COGS. A higher ending inventory results in a lower COGS, which increases gross profit and taxable income. Conversely, a lower ending inventory results in a higher COGS, reducing gross profit and taxable income. Here are some year-end strategies:
- Identifying and writing down obsolete or slow-moving inventory at year-end can lead to reductions in taxable income, as the inventory's reduced value is recognized as a loss.
- Delaying inventory purchases until after year-end, businesses can manage their COGS and effectively reduce taxable income, thereby optimizing their financial results for the current year.
Contributing to a Retirement Plan:
Retirement plan contributions not only offer significant tax advantages but also facilitate future savings for both business owners and employees. For self-employed individuals, contributing to a retirement plan such as a Simplified Employee Pension (SEP) IRA can be highly beneficial. Business owners can contribute up to 25% of their net self-employment earnings, with a maximum contribution of $70,000 for 2025. The advantage of a SEP IRA is its flexible contribution deadline, which extends until the tax return filing date, offering additional planning time.
For sole proprietors, freelancers, and independent contractors, a Solo 401(k) presents an excellent opportunity due to its dual-role contribution system, where you are considered both employer and employee, allowing for substantial contribution limits. This makes it an ideal choice for maximizing retirement savings. Additionally, employers can enhance employee satisfaction and retention by offering year-end bonuses and retirement plan contributions, which are often deductible. This dual benefit of tax savings and employee incentive strengthens both the company's financial position and workforce stability.
Maximize the Qualified Business Income (QBI) Deduction:
As the year-end approaches, business owners should take strategic steps to maximize the Qualified Business Income (QBI) deduction (also known as the Sec 199A deduction), a vital tax benefit allowing up to a 20% deduction on qualified business income. To optimize this deduction, first review your income levels to ensure they fall below the $197,300 for single filers or $394,600 for joint filers threshold (2025 amounts) to avoid phase-outs. Adjusting a “working shareholder’s” W-2 wages appropriately, aligning with industry standards while considering IRS scrutiny, is essential for businesses structured as S corporations. Making capital investments can enhance deductions through Section 179 expensing or bonus depreciation, effectively lowering business income.
Review Accounts Receivable for Bad Debts:
As year-end approaches, business owners should evaluate their accounts receivable to consider writing off bad debts, which can provide valuable tax deductions. A bad debt is an uncollectible amount owed to your business, often arising from unpaid customer invoices or unreturned loans, and is categorized as either business or nonbusiness. To qualify for a business bad debt deduction, the debt must have been previously included in your business's income, and it should be related to regular business operations.
For accrual method taxpayers, these debts are deductible in the year they become worthless. Documenting diligent collection efforts and the debt's worthlessness is crucial for IRS compliance. Effective management of bad debts not only cleans up financial records but also optimizes taxable income, ultimately enhancing your business’s financial health. Consult with a tax advisor to ensure you take full advantage of this deduction as part of your year-end tax strategy.
Pre-Pay Expenses: As the year-end approaches, business owners can strategically manage their cash flow by prepaying expenses to reduce taxable income and, consequently, tax liability. By accelerating deductible business expenses such as insurance premiums, office supplies, or marketing costs before December 31st, you can effectively lower this year’s taxable income. This is especially beneficial for businesses using the cash accounting method, where expenses are deducted in the year they're paid. Prepaying up to 12 months of expenses, allowed under the IRS’s safe harbor rule, can be an effective way to pull deductions into the current tax year, provided income can be appropriately deferred without jeopardizing cash flow needs.
Deferring Income:
Deferring income to the following year can keep a business under certain tax thresholds, thus optimizing tax outcomes. For cash basis taxpayers, delaying client billing until after the new year means that income is counted when received. However, careful consideration is required to ensure that deferring income won't adversely affect business operations or relationships. Balancing these strategies allows business owners to manage their taxable income actively, ensuring smoother cash flow and potentially significant tax savings.
First Year in Business?
If so, you can elect to deduct up to $5,000 of start-up and $5,000 of organizational expenses in the first year of a business. Each of these $5,000 amounts is reduced by the amount by which the total start-up expense or organizational expense exceeds $50,000. Expenses not deductible in the first year of the business must be amortized over 15 years.
Avoid Underpayment Penalties:
If you are going to owe taxes for 2025, you can take steps before year-end to avoid or minimize the underpayment penalty. The penalty is applied quarterly, so making a fourth quarter estimated payment only reduces the fourth-quarter penalty. However, withholding is treated as paid ratably throughout the year, so increasing withholding at the end of the year can reduce the penalties for the earlier quarters. Here are some possible solutions:
- If you have a qualified retirement plan, a temporary solution to address the under- withholding is to take an unqualified distribution from a qualified retirement plan, utilizing this as a temporary solution to address withholding shortfalls. Upon taking the distribution, 20% is automatically withheld for federal income taxes, providing an opportunity to catch up on required tax payments and avoid underpayment penalties. Meanwhile, you can mitigate tax implications by rolling over the full amount of the distribution, including the withheld portion, back into the plan within the 60-day window. This maneuver requires the use of other funds to cover the withheld amount during the rollover but allows for maintaining the tax-deferred status of the retirement savings and ensures compliance with rollover rules. This approach offers a unique yet viable method to align tax payments without incurring additional tax liabilities on the distribution.
- If you are married and your spouse is employed, the spouse can increase withholding for the end of the year. Even withhold as much as the entire paycheck with the help of a cooperative employer.
- If you have other sources of income subject to withholding, have the withholding increased appropriately.
It may be beneficial for you to consult with this office to estimate your underpayment and whether an underpayment penalty exception might apply.
Are You a Working Shareholder in an S Corporation?
If so, you may not be aware of the IRS’s “reasonable compensation” requirements, which can influence your Section 199A (qualified business income) deduction and your payroll taxes. Reviewing the requirements as they apply to your circumstances may avoid future problems with the IRS.
Planning on Paying Your Employees a Bonus?
Consider paying your employees their bonuses before year-end, rather than after the start of the new year. That way you benefit from the tax deduction a year sooner.
Reassess Your Business Entity:
The end of the year is a smart time to evaluate whether your current business structure is still the best fit for your operations. Each structure has unique tax and liability implications. Options include sole proprietorships, partnerships, limited liability company, S Corporation and C Corporation.
Conclusion: While year-end strategies primarily aim to manage and reduce income tax liabilities, it's important to remember their wider financial benefits. Implementing these strategies can also diminish the burdens of self-employment tax and business payroll taxes. By shifting income, optimizing deductions such as the Qualified Business Income (QBI) deduction, and making strategic investments or prepayments, businesses can decrease taxable income to more favorable levels, thus lowering associated tax obligations across the board. Such comprehensive tax planning not only enhances cash flow but also strengthens the financial position of the business, paving the way for a more robust and tax-efficient new year. As you finalize your year-end financial strategies, consider consulting with this office to ensure you maximize these opportunities across all tax dimensions.
For generations, the traditional idea of inheritance was simple: Parents built wealth during their lifetimes, and their children received what was left after they died. That model is starting to change. More parents are asking a different question: Would some of this money do more good for my family now than it will 20 or 30 years from now? That question is especially relevant for financially secure retirees whose adult children may be facing some of the most expensive years of their lives: buying a first home, raising children, paying for education, starting a business, or managing the cost of living in an expensive area. Instead of waiting until their children are in their 50s or 60s to receive an inheritance, some families are choosing to transfer part of their wealth earlier. This is sometimes called a living inheritance . It can be a powerful strategy, but it should be approached carefully. Why Timing Matters An inheritance can be valuable at any age. But $100,000 received at age 35 may change someone's life very differently than $100,000 received at age 65. At 35, that money might help with: A down payment on a first home Paying off high-interest debt Starting or expanding a business Childcare costs Education expenses Building an emergency reserve Investing earlier for retirement At 65, many of those major life decisions may already have been made. That does not mean parents should start giving away everything they have. It simply means there may be value in thinking about when family wealth can have the greatest impact, not just how much will eventually be inherited. Your Own Financial Security Comes First Before making a significant gift, the first question should not be: “How much can I give?” It should be: “How much can I give without putting my own future at risk?” Retirement can last decades. Healthcare costs can rise. Long-term care may become necessary. Investment markets can decline. Homes need repairs. Inflation can reduce purchasing power. A gift that feels comfortable at age 65 could feel very different at age 85. Before transferring significant assets, it is important to look at expected retirement income, expenses, emergency reserves, healthcare needs, insurance coverage, and the overall estate plan. Generosity works best when it comes from financial strength. Not All Gifts Trigger an Immediate Tax Bill Many people hear the phrase “gift tax” and assume that giving a large amount of money to a child will automatically create an immediate tax bill. That is usually not how the system works. Federal tax law provides an annual gift-tax exclusion , allowing you to give up to the annual exclusion amount to a recipient without generally needing to file a gift-tax return for that gift. If a gift exceeds the annual exclusion, a gift-tax return, Form 709, may be required. That does not necessarily mean you will owe tax out of pocket. For many families, the return is primarily used to report the gift and track the amount applied against the donor's lifetime estate and gift-tax exemption. The important point is that large transfers should be planned, documented, and reported correctly rather than handled casually. Some Payments Can Be Treated Differently There are also situations where helping a family member can be structured differently than simply handing them cash. For example, qualifying tuition paid directly to an educational institution and certain medical expenses paid directly to the provider may receive special treatment for federal gift-tax purposes. That can make a meaningful difference for families helping with college or major healthcare costs. The details matter, however. The payment generally has to be made in the proper manner to qualify for the special treatment. Before moving a large amount of money, it may be worth checking in with our office first. Cash Is Not Always the Same as Appreciated Property The type of asset you give can matter just as much as the dollar amount. Cash is relatively straightforward. Appreciated stocks, real estate, business interests, and other investments can create very different tax consequences. One of the most important concepts is tax basis . When appreciated property is gifted during life, the recipient generally takes the donor's basis in the property, subject to applicable rules. Suppose you purchased an investment years ago for $100,000 and it is now worth $500,000. If you give that investment to your child, your child generally does not receive a new $500,000 tax basis simply because the gift was made. If the asset is later sold, the built-in appreciation may result in substantial capital gains. Why the “Step-Up in Basis” Matters Assets inherited at death may be treated differently. For federal tax purposes, many inherited assets receive what is commonly called a step-up in basis , generally adjusting the basis to fair market value as of the applicable valuation date. That can significantly reduce the taxable gain recognized on a later sale. This is why a family should not automatically assume that transferring appreciated stocks, real estate, or other property during life is better than allowing those assets to pass through the estate. In some situations, gifting cash while retaining highly appreciated assets may produce a better tax result. In others, there may be compelling reasons to transfer appreciated property during life. The right answer depends on the assets involved, the estate plan, the family's tax situation, and the larger objectives. Helping With a Home Can Have Long-Term Impact Housing is one of the most common reasons parents consider making significant gifts to adult children. In many markets, the biggest obstacle is not necessarily the monthly mortgage payment. It is accumulating the down payment. Parents may choose to: Gift part of the down payment Make a family loan Purchase property jointly Help with closing costs Help reduce an existing mortgage balance Each approach can have different tax, legal, and family implications. A family loan, for example, should generally be properly documented and may need to charge an appropriate interest rate. If multiple children are involved, parents may also want to decide whether the assistance is intended as a gift, a loan, an advance on inheritance, or simply help based on each child's individual circumstances. Those decisions are much easier to make before money changes hands. Education Is Another Opportunity Parents and grandparents sometimes decide education is one of the best uses of family wealth. Helping a child or grandchild graduate with less debt can provide a financial advantage that lasts for decades. Options may include: Paying qualifying tuition directly Contributing to education savings accounts Helping with graduate school Assisting with other education-related expenses Different approaches can have different tax consequences. Planning the transfer before making it can help families choose a structure that fits both the educational goal and the broader estate plan. A Living Inheritance Is About More Than Taxes Taxes matter, but they are not the only consideration. Giving money during your lifetime also changes family dynamics. Some parents worry that giving too much too soon may reduce motivation or create dependence. Others worry about fairness when children have very different financial needs. One child may need help buying a home. Another may have received substantial help with graduate school. A third may be financially independent and need very little. Equal and fair are not always the same thing. It is worth deciding how gifts will be communicated and whether lifetime assistance should be reflected in the broader estate plan. Clarity today can prevent misunderstandings later. You Also Get to See the Impact There is one benefit of a living inheritance that has nothing to do with taxes. You get to see what the money does. You can watch your child buy a home. You can see your grandchild graduate. You can help launch a family business. You can take the family on a trip everyone will remember. You can see the relief that comes from eliminating a major financial burden. For some families, that experience is more meaningful than simply leaving behind a larger account balance. Before Making a Large Gift, Ask These Questions Before transferring significant money or property, consider: Am I financially secure enough to make this gift? Could I need this money later in retirement? Is cash the best asset to transfer? Will the gift require a gift-tax return? Could gifting appreciated property create future capital gains? Would a direct tuition or medical payment be more efficient? Is this a gift, a loan, or an advance on inheritance? How will this affect my estate plan? If I have multiple children, how do I want to handle fairness? Should this decision be coordinated with my other advisers? These questions can help turn a generous idea into a thoughtful financial strategy. A Note About the Bigger Planning Picture Our office can help evaluate the tax consequences of lifetime gifts, compare different transfer strategies, and help structure transactions in a tax-conscious way. At the same time, decisions about overall estate distribution, retirement sustainability, investment strategy, and legal estate documents involve broader financial and legal considerations. For that reason, significant gifting decisions should often be coordinated with your estate attorney and financial advisor as well. We are always happy to work alongside your other advisers so the tax strategy supports the family's complete financial plan. The Goal Is Not to Give More. It Is to Give Smarter. A living inheritance is not right for every family. Some retirees need to preserve their assets for their own future. Others may prefer to transfer most wealth through their estate. Many families will ultimately use a combination of lifetime gifts and a traditional inheritance. The important point is that inheritance does not have to be something that happens automatically decades from now. If you are considering helping children or grandchildren with a home, education, business, or another major financial milestone, check in with our office before money or assets change hands. We can help you evaluate the tax consequences, compare different ways to structure the transfer, and coordinate the tax side with your broader estate and financial planning. Sometimes the best legacy is not simply what you leave behind. It is what you are able to help your family accomplish while you are still here to see it. For assistance with planning for your future, request a quote with us today!
October 2026 Individual Due Dates October 13 - Report Tips to Employer If you are an employee who works for tips and received more than $20 in tips during September, you are required to report them to your employer no later than October 13. You can use IRS Form 4070 or your own statement that includes your signature; name, address and Social Security number; employer’s name (or establishment’s name if different) and address; month or period the report covers, and total of tips received during that month or period. Your employer is required to withhold FICA taxes and income tax withholding for these tips from your regular wages. If your regular wages are insufficient to cover the FICA and tax withholding, the employer will report the amount of the uncollected withholding in box 8 of your W-2 for the year. You will be required to pay the uncollected withholding when your return for the year is filed. October 15 - Individuals If you requested an automatic 6-month extension to file your income tax return for 2025, file Form 1040 and pay any tax, interest, and penalties due. October 15 - Taxpayers with Foreign Financial Interests If you received an automatic 6-month extension of time to report your 2025 foreign financial accounts to the Department of the Treasury, this is the due date for Form FinCEN 114. Weekends & Holidays: If a due date falls on a Saturday, Sunday or legal holiday, the due date is automatically extended until the next business day that is not itself a legal holiday. Disaster Area Extensions: Please note that when a geographical area is designated as a disaster area, due dates will be extended. For more information whether an area has been designated a disaster area and the filing extension dates visit the following websites: FEMA: https://www.fema.gov/disaster/declarations IRS: http s ://www.irs.gov/newsroom/tax-relief-in-disaster-situations October 2026 Business Due Dates October 15 - Corporations File a 2025 calendar year income tax return (Form 1120) and pay any tax, interest, and penalties due. This due date applies only if you timely requested an automatic 6-month extension by April 15. October 15 - Social Security, Medicare and Withheld Income Tax If the monthly deposit rule applies, deposit the tax for payments in September. October 15 - Nonpayroll Withholding If the monthly deposit rule applies, deposit the tax for payments in September. October 15 - Last Day to Establish a Keogh Account for 2025 If you received an automatic 6-month extension of time to file your 2025 tax return and are self-employed, October 15, 2026, is the last day to establish a Keogh Retirement Account if you plan to make a contribution for 2025. October 15 - SEP IRA & Keogh Contributions Last day to contribute to a SEP or Keogh retirement plan for calendar year 2025 if your tax return is on extension through October 15. Weekends & Holidays: If a due date falls on a Saturday, Sunday or legal holiday, the due date is automatically extended until the next business day that is not itself a legal holiday. Disaster Area Extensions: Please note that when a geographical area is designated as a disaster area, due dates will be extended. For more information whether an area has been designated a disaster area and the filing extension dates visit the following websites: FEMA: https://www.fema.gov/disaster/declarations IRS: https: / /www.irs.gov/newsroom/tax-relief-in-disaster-situations
As families prepare for the new school year, many states are once again offering sales tax holidays —limited-time periods when shoppers can purchase certain items without paying state sales tax. While these tax-free events can lead to meaningful savings, the rules vary widely by state. Some holidays last only a weekend, while others span several weeks. Eligible items also differ, with some states exempting only clothing and school supplies while others include computers, emergency preparedness equipment, or energy-efficient appliances. Source: Sales Tax Institute. What Is a Sales Tax Holiday? A sales tax holiday is a designated period during which states temporarily suspend sales tax on specific purchases. Most are timed around the back-to-school shopping season, although some states also hold tax holidays for hurricane preparedness, hunting supplies, or energy-efficient products. Source: Sales Tax Institute. Which States Are Participating? Where Are Back-to-School Sales Tax Holidays Happening? The following states are offering statewide back-to-school sales tax holidays or similar tax relief programs during the 2026 shopping season. Keep in mind that dates, eligible items, and price limits vary by state. Arkansas (Aug. 1–2): Clothing, school supplies, instructional materials, and many electronics. Connecticut (Aug. 16–22): Clothing, footwear, backpacks, and qualifying school supplies under applicable limits. Florida (July 20–Aug. 20): Clothing, school supplies, learning aids, and computers meeting price thresholds. Illinois (Aug. 7–16): Reduced state sales tax rate on qualifying clothing, footwear, and school supplies. Iowa (Aug. 7–8): Clothing and footwear under $100 per item. Maryland (Aug. 9–15): Clothing and footwear priced at $100 or less. Massachusetts (Aug. 8–9): Most retail items priced up to $2,500 qualify, with certain exclusions. Missouri (Aug. 7–9): Clothing, school supplies, computers, software, and calculators within price limits. New Mexico (July 31–Aug. 2): Clothing, school supplies, computers, backpacks, calculators, and related technology. Ohio (Aug. 7–9): Qualifying clothing, school supplies, and instructional materials. Oklahoma (Aug. 7–9): Clothing and footwear under $100 per item. South Carolina (Aug. 7–9): Clothing, school supplies, computers, printers, software, and select household items. Tennessee (July 31–Aug. 2): Clothing, school supplies, and qualifying computers. Texas (Aug. 7–9): Clothing, footwear, backpacks, and most school supplies under $100 per item. Virginia (Aug. 7–9): Clothing, school supplies, emergency preparedness items, and qualifying Energy Star products. West Virginia (July 31–Aug. 3): Clothing, school supplies, laptops, tablets, and qualifying sports equipment. While back-to-school shopping receives the most attention, it's not the only type of sales tax holiday taking place throughout the year. Several states also offer temporary tax exemptions on items such as hurricane and emergency preparedness supplies, Energy Star® appliances, hunting and fishing equipment, firearms and ammunition, severe weather preparedness products, and even certain purchases made by members of the National Guard. These holidays are designed to encourage preparedness, support conservation efforts, or promote specific industries, and the qualifying items and dates vary widely by state. Before making a major purchase, it's worth checking whether your state offers a tax holiday that could help you save. Source: Sales Tax Institute; Federation of Tax Administrators. Read the Fine Print One of the biggest misconceptions about sales tax holidays is that everything is tax-free. In reality, each state establishes its own eligibility rules. Many programs include price limits, exclude luxury goods or accessories, or apply only to certain categories of merchandise. Some states also have different rules for online purchases, layaway transactions, coupons, and shipping charges. Source: Sales Tax Institute; Federation of Tax Administrators. Are the Savings Worth It? For families already planning back-to-school shopping, timing purchases to coincide with a sales tax holiday can reduce costs . With back-to-school expenses continuing to rise, even modest tax savings can make a difference, especially when purchasing clothing, backpacks, school supplies, or computers that qualify under your state's rules. However, shoppers shouldn't buy items simply because they're temporarily tax-free. The greatest benefit comes from purchasing items you were already planning to buy while understanding your state's specific requirements. Sales tax holidays can provide valuable savings, but they aren't one-size-fits-all. Before heading to the store, or placing an online order, check your state's rules to confirm the dates, eligible items, and any purchase limits that apply. If you own a retail business, remember that sales tax holidays also create additional compliance responsibilities. Your tax professional can help ensure you're applying your state's rules correctly and collecting the appropriate amount of sales tax throughout the year.