Year-end tax checklist for the self-employed: 10 things to do before December 31, 2026

Most of your tax bill for 2026 is already decided by what you earned. But a few things only count if you do them by December 31, 2026, and a few more are much easier to do now than in March. Here's the list we'd work through, in order.

1. Find out where you stand

Add up your income and expenses for January through November and make a rough guess at December. You need that number for everything below. If your records are in your bank account, download the transactions as a CSV (or turn PDF statements into a spreadsheet with our free converter) and drop them into the free profit and loss template.

Then put the profit into the quarterly tax calculator. It tells you your total 2026 tax and how much is still to pay.

2. Plan the January 15 payment

The fourth estimated payment for 2026 is due Friday, January 15, 2027. If you're behind, a bigger January payment stops the underpayment penalty from growing, even though it can't erase penalty already built up for earlier quarters.

You can skip the January payment if you file your 2026 return and pay everything by February 1, 2027. If you have a W-2 job too, extra withholding from your last December paychecks counts as if it were paid evenly through the year, so it can patch earlier quarters as well. Our safe harbor guide shows the minimum you need to have paid.

3. Pay for things you were going to buy anyway

Most freelancers use the cash method: income counts when you receive it and expenses count when you pay them. A business expense paid on December 30 goes on your 2026 return. Paid on January 2, it waits until 2027.

So if you were going to renew software, restock supplies, or pay for a course in January anyway, paying in December moves the deduction forward a year. Don't buy things you don't need: a $1,000 expense saves roughly $230 to $310 in tax for most freelancers, so it still costs you about $700.

4. Buy equipment before the year ends, if you need it

A laptop, camera or desk used for your business can usually be written off in full in the year you start using it, instead of over several years:

• The de minimis safe harbor lets you deduct items costing up to $2,500 per item or invoice as an expense, if you make the election with your return and treat them the same way in your books.
• 100% bonus depreciation is permanent for property acquired after January 19, 2025, under the One, Big, Beautiful Bill.

The equipment has to be in service, meaning set up and ready to use, by December 31. If you use it partly for personal things, only the business share counts.

5. Decide on a retirement plan

Retirement contributions are one of the few large deductions you control:

• A SEP IRA can be opened and funded as late as your tax return's due date, including extensions. As a sole proprietor you can put in about 20% of your profit after the self-employment tax deduction, up to $72,000 for 2026. On $60,000 of profit that's roughly $11,150.
• A solo 401(k) allows an "employee" contribution of up to $24,500 for 2026 ($32,500 at age 50 or older, $35,750 at 60 to 63) on top of the employer share, so it can shelter much more on a modest profit. Its setup and election deadlines are different from a SEP's, so if you want one for 2026, talk to the provider before December 31.

Contributions also lower the income the Marketplace uses for health insurance subsidies.

6. Sort out health insurance for 2027

Marketplace open enrollment runs until January 15, 2027, but you need to enroll by December 15 for coverage that starts January 1. Premiums you pay are usually deductible: see the self-employed health insurance deduction. The extra subsidies from 2021 to 2025 have ended, so check the new price before you auto-renew.

7. Finish your mileage log

Write down your odometer reading on December 31 and fill any gaps in your log while you still remember the trips. For 2026 the rate is 72.5¢ a mile from January to June and 76¢ from July to December, so a log that records dates matters. Our mileage guide has the rules, and the free mileage log template splits the two rates for you.

8. Collect W-9s from anyone you paid

If you paid a contractor $2,000 or more for services in 2026, you may need to send them a Form 1099-NEC by February 1, 2027. Ask for a Form W-9 now, while they're still answering emails. Payments you made by card or through PayPal or a similar app are reported by the payment company instead, so you don't send a 1099-NEC for those.

9. Check what forms you'll receive

Make a list of clients who paid you $2,000 or more (they may send a 1099-NEC) and the platforms that paid you over $20,000 in more than 200 sales (a 1099-K). When the forms arrive in January, check them against your own totals and ask for corrections early. Income with no form is still taxable, so don't wait for a form to count it.

10. Set up 2027 before it starts

Open a separate savings account for tax if you don't have one, and pick a set-aside rate for every payment you receive. The 2027 tax brackets are out, and your first 2027 estimated payment is due April 15, 2027. If you'd like a system that does the sorting and the quarterly math for you, that's what the Paid & Filed workbook is for.