Do I need to send the IRS money as soon as a big commission lands?

Not necessarily — if safe-harbor payments are on track, you're penalty-protected and can hold the reserve until April. The money should be segregated immediately either way.

Can I defer a commission to January to lower this year's tax?

Only if arranged before the commission is payable — constructive-receipt rules prevent declining money already available. Deferral helps only when next year's bracket will genuinely be lower.

What is a cash balance plan?

A defined-benefit plan layered on a solo 401(k) that can allow six-figure deductible contributions depending on age and income. It fits consistently high earners who can commit to multi-year funding, not a single spike year.

Answer Library · CRE Broker Tax

I just closed a huge deal. What should I do before December 31?

Q: Does a big year change my S Corp salary?

Often yes — reasonable compensation scales with what the business earned. A year that doubles profit usually supports a higher salary, implemented in the December calibration payroll.

Short Answer

First, secure the tax: set aside a realistic share of the commission immediately and check your safe-harbor position, because a monster year means next April's bill is coming regardless. Then work the levers that only exist before December 31: maxing retirement contributions, calibrating your S Corp salary and withholding on a year-end payroll, timing deductible purchases you already planned, funding a PTET payment if you've elected, and — for the charitably inclined — bunching gifts through a donor-advised fund. The one thing not to do is buy things you don't need for deductions you'll regret.

Step one: protect yourself from April

A big commission doesn't change your safe-harbor number — if you're paying 110% of last year's tax, you're penalty-proof no matter how large this year gets. But penalty-proof isn't paid. The gap between your safe-harbor payments and the actual tax on the big year lands as a balance due in April, and it can be enormous. The move is simple and unglamorous: park the tax share of the commission (often 35–45% at top brackets, depending on your state) somewhere it earns interest and can't be spent, the week the wire lands.

The levers that expire December 31

Retirement contributions. A big year is exactly when to fill the solo 401(k) to the ceiling — employee deferral, employer contribution, catch-up if you're 50+. For very large incomes, a cash balance / defined benefit plan can shelter well into six figures, but it must be established before year-end and involves multi-year commitments; this is the single biggest deduction most high-earning brokers never hear about in time.
The December payroll calibration. If you're an S Corp, a big year usually justifies a higher reasonable salary — and the year-end payroll is where you true it up, load withholding to cure any estimate shortfall (withholding counts as paid evenly all year), and book the health-insurance add-back.
PTET funding. If you've elected a pass-through entity tax, many states require or reward payment by December 31 for the entity to deduct it this year. A big year makes the election more valuable, not less.
Planned purchases, accelerated. Equipment, technology, or the business vehicle you already intended to buy: purchasing and placing it in service before year-end moves the deduction into the high-bracket year where it's worth the most.
Charitable bunching. A donor-advised fund lets you take a large deduction this year — against your highest bracket — while distributing to charities over several years. Appreciated stock instead of cash adds a capital-gains bonus.
Harvesting the portfolio. A high-income year is a reasonable time to realize losses that offset gains — and a terrible year to realize discretionary gains.

What a big year is NOT the time for

Panic purchases. Spending $80,000 to save $30,000 only makes sense if you wanted the thing anyway. A deduction is a discount, never a rebate.
Exotic shelters. Aggressive schemes tend to surface in big years, marketed precisely to people with sudden tax bills. If the pitch leads with the deduction rather than the economics, walk.
Ignoring next year. Some levers work better spread across years — if you know next year will be leaner, certain income and deduction timing decisions flip.

Sequence beats scramble

Every item above is calendar-bound, and several interact — the salary decision touches retirement room, QBI, and withholding at once. The difference between capturing these levers and reading about them in February is having the projection done in the fall. That standing year-end projection and checklist is the core cadence of S Corp Management — built for exactly the year the big deal closes.

By Mike Salmon, CFP®, EA · Principal, For CRE Brokers · Moisand Fitzgerald Tamayo, LLC Published July 12, 2026 · Reviewed July 12, 2026

This article is general education for commercial real estate brokers, not individualized tax, legal, or investment advice. Figures are illustrative and rounded. Consult a qualified professional about your specific situation.

Quick answers

Do I need to send the IRS money the week the big commission lands?

Not necessarily — if your safe-harbor payments are on track, you're penalty-protected and can hold the tax reserve yourself until April. If you're not on the safe harbor, the next quarterly deadline matters. Either way, the money should be segregated immediately; the only question is whose account it sits in.

Should I ask the brokerage to pay me in January instead?

Deferring income to next year helps only if next year's bracket will actually be lower — and constructive-receipt rules mean you can't just decline money that's available to you. For genuinely lumpy careers, deferral discussions are legitimate but need to be arranged before the commission is payable, not after.

What's a cash balance plan and am I big enough for one?

A defined-benefit plan layered on top of a solo 401(k) that can allow very large deductible contributions — often $100,000+ depending on age and income. It suits brokers with consistently high income who can commit to funding for several years; a single spike year alone usually isn't the right fit.

Does a big year change my S Corp salary?

Often, yes. Reasonable compensation scales with what the business earns and what your services produced. A year that doubles your profit usually supports — and may require — a higher salary, which the December payroll can implement in one calibrated run.

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