A Quick Action Guide for Real Estate Investors and Service Business Owners
If you are a real estate investor, freelancer, consultant, or service based business owner, here is the good news:
You still have time to reduce your 2025 tax bill.
Several powerful tax strategies can be implemented right up until you file your return, and in some cases, until April 15, 2026. Below are a few high impact moves to review before you submit your return.
1. No Retirement Plan You Still Have an Opportunity
If you have self employment income, you can still contribute to a SEP IRA for the 2025 tax year up until your filing deadline, including extensions.
This allows you to reduce taxable income, lower your tax bill, and build retirement savings at the same time.
Example:
Maria, a marketing consultant, earned 80,000 dollars in net profit in 2025. She can contribute about 20 percent, approximately 16,000 dollars, into a SEP IRA.
That reduces her taxable income from 80,000 dollars to 64,000 dollars.
This single move could potentially save thousands in taxes.
If your 2025 profits were strong, this is one of the most powerful last minute strategies available.
2. High Deductible Health Plan Do Not Miss This
If you are enrolled in a high deductible health plan, you may qualify to contribute to a Health Savings Account, commonly known as an HSA.
HSAs are one of the most tax efficient tools available:
Contributions are tax deductible.
Growth is tax free.
Withdrawals for qualified medical expenses are tax free.
For 2025, contribution limits are:
4,300 dollars for individual coverage
8,550 dollars for family coverage
An additional 1,000 dollars catch up contribution if age 55 or older
You have until April 15, 2026 to make your 2025 contribution.
Example:
David contributes the 8,550 dollar family maximum. If he is in the 24 percent tax bracket, this could reduce his tax bill by more than 2,000 dollars.
This is immediate savings by using a benefit already available to you.
3. Using Your Personal Car for Business Make Sure It Is Documented
If you used your personal vehicle for property showings, supplier runs, client meetings, or job site visits, documentation is critical.
The IRS requires a contemporaneous mileage log that includes:
Date
Mileage
Destination
Business purpose
If you have not tracked consistently, reconstruct your log now using your calendar, Google Maps timeline, and appointment records.
Example:
Sarah drove 5,000 business miles in 2025. At 70 cents per mile, that equals a 3,500 dollar deduction.
Without proper documentation, she risks losing that deduction in the event of an audit.
Spending time now to document it protects this key expense.
4. Quick Deduction Checklist Before You File
Review the following before submitting your return:
Business expenses paid with personal funds
Did you purchase software, office supplies, or professional education using a personal credit card? Make sure those receipts are included.
Quarterly estimated tax payments
Confirm that all four 2025 payments are recorded accurately. If you missed the January 15, 2026 payment, file and pay as soon as possible to reduce penalties.
Home office deduction
If you qualify, confirm your square footage and calculate related expenses such as utilities and internet.
Small details can significantly impact your final tax outcome.
Final Step Do Not Guess
These strategies are valuable, but only if they are implemented correctly.
The difference between assuming it is correct and knowing it is structured properly can mean thousands of dollars.
If you are a real estate investor or service based business owner, now is the time to review your numbers carefully before filing.
Smart planning today helps you avoid unnecessary taxes tomorrow.
