[The] basic rule is “accelerate expenses, delay income.”The concept is that it’s always better to pay taxes later rather than sooner. In essence, you delay taxes for an entire year on income you’ve put off receiving until January and get the benefit of deductions a whole year earlier for December expenses.
The easiest way to “accelerate expenses, delay income” is to send out invoices at the end of the month and prepay January bills. Of course, if you’ve had a bad year - you have no profits or will be in a low tax bracket - reverse this and accelerate income and delay expenses.
Photo by Rickenbacker.
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