A Quarter-by-Quarter Tax Planning Calendar for Houston Small Businesses

A roofing contractor in Spring called me in mid April, panicked. He owed $14,200 in taxes. He’d known since January that the number would be big (his best year ever, $380,000 in revenue) but he’d been too busy with jobs to deal with it. No estimated payments made. No deductions tracked. No retirement contributions. Just twelve months of deposits and expenses in a QuickBooks file he hadn’t opened since November.

His CPA did the return. The $14,200 was the tax. The underpayment penalty was another $740. And the retirement contribution window for the prior year had already closed on April 15, which meant he missed the chance to shelter $23,000 in a SEP IRA that would have cut his tax bill by roughly $5,500.

Total cost of not planning: $6,240 in penalties and lost savings. On top of the $14,200 he already owed.

Tax planning isn’t something that happens in March. It happens all year, in small decisions that compound. A quarterly estimated payment made on time in September is $200 in penalties avoided. An equipment purchase made in November instead of January is $7,000 in deductions captured this year instead of next. A retirement contribution timed to Q4 is money that works twice. Reducing taxable income now and growing tax free later.

Here’s what a year of tax planning looks like, quarter by quarter, for a Houston small business.

Q1: January Through March

What’s Happening

Tax season for the prior year is in full swing. CPAs are buried. Business owners are scrambling to find receipts they should have organized months ago. And simultaneously, the current year’s financial trajectory is already being set.

This quarter is about two things at once: closing the prior year cleanly and setting up the current year correctly.

The Prior Year Cleanup

If the books aren’t closed for the prior year, this is the emergency. Every transaction from January 1 through December 31 needs to be reconciled, categorized, and reviewed before the CPA can file. Catch up bookkeeping during Q1 is the most common service request I get from Houston businesses, and it’s the most expensive. Because everything is rushed.

Prior year retirement contributions still have a window. SEP IRA contributions can be made up to the tax filing deadline (April 15, or October 15 with an extension). For an S Corp owner with $120,000 in W-2 wages, a SEP IRA contribution of up to 25% of compensation ($30,000) reduces taxable income dollar for dollar.

Current Year Setup

This is the quarter to set projections. Based on prior year income, what does this year look like? If revenue is growing, estimated tax payments need to increase. If a big project is coming in Q2, the cash impact of the tax hit needs to be planned now.

I sit down with Houston clients in January or February and run a projection based on three scenarios: same as last year, 15% growth, and 30% growth. Each scenario produces a different estimated payment schedule. The business owner picks the one that matches their pipeline, and I adjust quarterly as reality diverges from the forecast.

Key Deadlines

• January 15: Q4 estimated payment for the prior year (if not paid in December)
• January 31: W-2s and 1099s due to employees and contractors
• March 15: S Corp and partnership returns due (Form 1120-S, Form 1065). Extensions available but estimated taxes are still owed.
• April 15: Individual returns due. Q1 estimated payment for the current year due. SEP IRA contribution deadline for prior year (without extension).

Q2: April Through June

What’s Happening

Tax season is over. The pressure drops. And this is exactly when most business owners stop thinking about taxes for six months.

That’s the mistake.

Q2 is the highest leverage quarter for tax planning because there’s still time to change the outcome. Nine months remain in the tax year. Decisions made now (about retirement contributions, equipment purchases, entity structure, and income timing) have the maximum runway to produce savings.

The Mid Year Check In

By June, six months of financial data exists. That’s enough to run a meaningful projection for the full year.

The question isn’t “how much will I owe?” The question is “what can I do between now and December to reduce what I owe?”

For a Houston consulting firm that earned $80,000 in net profit through June and projects $160,000 for the full year, the mid year check in might reveal:

• Current estimated payments are too low by $3,000. Catching up now avoids an underpayment penalty in April.
• A $15,000 equipment purchase planned for January would save more in taxes if made before December 31, capturing the Section 179 deduction in the current year.
• An S Corp election filed by March 15 of the next year (with relief provisions) could save $9,000+ in self employment taxes. But the payroll system needs to be set up before the election takes effect, and that takes 4 to 6 weeks.

Each of these decisions has a window. Miss the window and the savings disappear.

Key Deadlines

• April 15: Q1 estimated payment for current year (also individual return deadline)
• June 15: Q2 estimated payment for current year

Q3: July Through September

What’s Happening

The year is two thirds done. The financial picture is clear enough to make concrete decisions, and there’s still one full quarter to act.

This is the quarter where I see the most money saved for clients who plan ahead, and the most money wasted by those who don’t. The difference between a business owner who reviews their Q3 numbers in August and one who waits until January is thousands of dollars in avoidable taxes.

The Equipment and Depreciation Window

Section 179 of the tax code allows businesses to deduct the full purchase price of qualifying equipment in the year it’s placed in service, rather than depreciating it over 5-7 years. For 2025, the deduction limit is $1,220,000.

A plumbing company in Katy that needs a new service van has a choice: buy it in September and deduct $55,000 this year, or buy it in January and deduct $55,000 next year. If this year’s income is higher than next year’s projected income, the deduction is worth more now. If a large project is wrapping up and next year looks slower, the calculus flips.

This decision requires knowing the numbers. Without current, reconciled books, it’s just a guess.

Retirement Contribution Timing

For business owners with SEP IRAs, SIMPLE IRAs, or solo 401(k) plans, Q3 is when contribution amounts start to crystallize.

A solo 401(k) allows employee deferrals of up to $23,000 (2025), plus employer contributions of up to 25% of net self employment income. For a Houston consultant earning $200,000, the total contribution could exceed $46,000. All tax deductible.

But the employee deferral portion must be elected before the end of the calendar year. Setting up a solo 401(k) takes 2 to 4 weeks. Waiting until December is cutting it dangerously close.

Key Deadlines

• September 15: Q3 estimated payment for current year. Also the extended deadline for S Corp and partnership returns.

Q4: October Through December

What’s Happening

The two week window between Thanksgiving and December 15 is the most compressed decision making period in a small business owner’s tax year. Every equipment purchase, charitable donation, retirement contribution, and income timing decision has to happen at once. And the stakes are real. A deduction missed by January 1 is gone forever for the current tax year.

Year End Tax Moves

Accelerate deductions. If current year income is higher than expected, pulling deductible expenses into December reduces the tax hit. Prepaying January rent, buying supplies in bulk, making the Q1 estimated payment early (it’s technically due January 15 but can be paid in December). A $10,000 acceleration at a 24% marginal rate saves $2,400 in federal taxes.

Defer income. For cash basis businesses (which is most Houston small businesses) income is recognized when received, not when earned. An invoice sent on December 28 that gets paid on January 3 is next year’s income. This is legal, normal, and one of the simplest tax timing strategies available. It works particularly well for service businesses with large project payments.

Max out retirement contributions. The deadline for solo 401(k) employee deferrals is December 31. Employer contributions can wait until the tax filing deadline, but the employee portion has a hard cutoff. I’ve worked with Houston clients who left $23,000 in tax sheltered contributions on the table because they waited until January to think about it.

Review estimated payments. If income came in higher than projected, the Q4 estimated payment (due January 15) should be adjusted upward. The IRS charges an underpayment penalty calculated daily. Roughly 8% annualized in 2025. Underpaying by $5,000 for a full year costs approximately $400 in penalties.

Texas Specific Considerations

Texas has no state income tax, which simplifies personal tax planning. But the Texas franchise tax applies to businesses with total revenue exceeding $2.47 million (2025 threshold). For businesses approaching that threshold, Q4 is when revenue management decisions matter.

Franchise tax is calculated on either total revenue or a modified margin formula, whichever produces a lower amount. The rate is 0.375% for retail and wholesale businesses, 0.75% for all others. At $3 million in revenue, the franchise tax for a service business is approximately $3,975. That’s not a huge number, but it surprises business owners who’ve been told “Texas has no business tax.”

Harris County and City of Houston business permits and renewals often come due in Q4 or early Q1. Missing a renewal doesn’t create a tax problem, but it creates a compliance problem that can delay SBA loans and other financing.

Key Deadlines

• October 15: Extended individual return deadline. Extended SEP IRA contribution deadline for prior year.
• December 31: Solo 401(k) employee deferral deadline. Last day to make deductible purchases for current tax year. Last day for charitable contributions to count in current year.
• January 15 (following year): Q4 estimated payment due.

The Cost of Waiting

The roofing contractor in Spring lost $6,240 by doing nothing for twelve months. Not because he made bad decisions. He made no decisions. The tax code doesn’t reward passivity. It rewards business owners who know their numbers, plan their timing, and make decisions with enough runway for those decisions to matter.

A year round tax plan doesn’t take much time. A January projection meeting, a June check in, a September equipment and retirement review, and a December close out. Four conversations, roughly an hour each. The businesses that have them consistently pay less in taxes, less in penalties, and less in CPA fees than the ones that show up in April with a grocery bag full of receipts.

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EZQ Group builds quarterly tax plans for Houston small businesses. From estimated payment calculations to year end strategy sessions with your CPA. Schedule a planning conversation before the next quarterly deadline catches you off guard.