Use these must-know tips to get on track in Q1.
If you didn't make these tax moves in January, you're already behind. But February isn't too late—here's your rescue plan.
It's February 10th. You meant to tackle your Q1 tax planning in January. You really did.
But January was insane. You had 50 new members join during your New Year promotion. Your 6am classes were packed. You were teaching extra sessions, managing new client onboarding, dealing with equipment that broke from overuse, and trying to keep up with the surge.
Tax planning? That got pushed to "later."
Now it's February, and you're realizing: you missed the boat on several time-sensitive tax strategies that could have saved you thousands. The deadline for some critical Q1 moves is rapidly approaching, and you're not even sure what you should have done.
Here's the good news: February isn't too late. Many of the most powerful Q1 tax strategies can still be implemented right now. But you need to act immediately, because once we hit March 31st (the end of Q1), several opportunities close permanently.
Let me show you what you missed in January, what you can still fix in February, and exactly how to implement everything in the next 30 days.
Most fitness professionals think tax planning happens in December or during tax season (March-April). They're wrong.
Smart tax planning happens year-round, with specific strategies deployed each quarter based on timing requirements and deadlines.
Q1 (January-March) is particularly critical because it sets the foundation for your entire year. The decisions you make in Q1 determine:
Miss these Q1 deadlines, and you can't fix them later. No amount of December scrambling will recover opportunities lost in Q1.
The fitness professionals who save $10,000-$15,000 per year in taxes are the ones who take Q1 planning seriously. They're not smarter than you. They're just more strategic about timing.
Let's make sure you don't leave $10,000 on the table this year.
Let me start with the bad news: here's what you should have done in January, and what it costs you if you didn't.
What you should have done: If you wanted to be taxed as an S-Corporation for 2025, you needed to file Form 2553 by March 15, 2025 (for calendar-year businesses).
Why it matters: S-Corp election can save you $8,000-$15,000 per year in self-employment taxes by allowing you to split your income between W-2 salary (subject to payroll taxes) and shareholder distributions (not subject to self-employment tax).
Real example: A powerlifting coach making $120,000 in profit pays $18,360 in self-employment taxes as a sole proprietorship. As an S-Corp taking a $60,000 salary and $60,000 in distributions, they pay only $9,180 in self-employment taxes on the salary portion.
Savings: $9,180 per year
What it costs if you missed it: You're stuck as a sole proprietorship or partnership for all of 2025. You'll pay that extra $9,180 in taxes. And you'll need to wait until January 2026 to file the S-Corp election for 2026.
The good news: We're still in February. You haven't missed this deadline yet. March 15th is your drop-dead date. Act now.
Learn more about S-Corp election for fitness professionals.
What you should have done: January is the ideal time to establish your retirement account for the year so you can start making contributions immediately.
Why it matters: The earlier in the year you set up your SEP IRA, Solo 401(k), or other retirement account, the more time you have to make strategic contributions that reduce your tax liability.
What it costs if you missed it: You haven't lost the opportunity entirely—you can still set up retirement accounts throughout the year. But you've lost two months of potential contribution planning.
More importantly, if you don't set it up now in February, you'll likely forget until December, when you're scrambling to make last-minute contributions and may not have sufficient cash flow.
The good news: February is perfect timing to establish retirement accounts. The year is young, you have clarity on your projected income, and you can plan contributions strategically.
What you should have done: January is when you should have planned your equipment purchases for the year, particularly any purchases you wanted to depreciate using Section 179.
Why it matters: Section 179 allows you to deduct the full cost of qualifying equipment in the year of purchase (up to $1,220,000 in 2025). This is a massive tax benefit, but only if you actually need the equipment and have the cash flow to purchase it.
What it costs if you missed it: You're not out of luck—you can purchase equipment anytime during the year. But waiting means you're losing months of use, and you may forget to make strategic purchases before year-end.
The good news: February is still early enough to identify equipment needs, budget for purchases, and plan the timing strategically.
What you should have done: If you're going to hire your kids or spouse this year, January is when you should have established the employment relationship and started documenting their work.
Why it matters: Hiring family members can shift income to lower tax brackets and generate legitimate business deductions. But the IRS scrutinizes these arrangements heavily. You need solid documentation showing:
Starting in January gives you 12 months of documentation. Starting in December looks like a tax scheme.
What it costs if you missed it: You haven't lost the opportunity, but you've lost one month of documentation. The stronger your paper trail, the more defensible the arrangement in an audit.
The good news: Starting family member employment in February still gives you 11 months of documentation, which is solid.
Now let's focus on solutions. Here's your February action plan to recover from a slow January:
If you're making over $80,000 in net income from your fitness business and you haven't elected S-Corp status, do this first—before anything else.
The deadline: March 15, 2025
That's only 5-6 weeks away as you're reading this in early February. This is not something you can procrastinate on.
What you need to do:
The tricky part: Determining your reasonable salary. Too low, and the IRS will reclassify your distributions. Too high, and you're not maximizing tax savings.
General guidelines for fitness professionals:
The smart move: Work with a CPA who specializes in fitness businesses to file your S-Corp election correctly. We've done this hundreds of times and know exactly what's defensible.
Don't try to DIY this. The tax savings are massive, but mistakes are costly. Get professional help.
More details on S-Corp strategy for gym owners.
Don't wait until December to think about retirement contributions. Set it up now.
Your retirement account options as a fitness professional:
Contribution limits: Up to 25% of compensation, maximum $69,000 in 2025
Pros:
Cons:
Who it's for: Gym owners with no employees, or those who want simplicity over maximum contribution capacity.
Contribution limits: Up to $69,000 in 2025 ($76,500 if age 50+)
How it works:
Pros:
Cons:
Who it's for: High-earning online coaches, personal trainers without employees who want to maximize retirement savings.
Contribution limits: Employee deferrals up to $16,000 in 2025 ($19,500 if age 50+), plus employer match
Who it's for: Gym owners with employees who want to offer retirement benefits without the complexity of a 401(k).
Your February action: Choose one and set it up. Most can be established online through Fidelity, Vanguard, or Schwab in under an hour.
Tax benefit: Contributions are tax-deductible, reducing your taxable income dollar-for-dollar.
Example: If you contribute $20,000 to a SEP IRA and you're in the 24% tax bracket, you save $4,800 in taxes.
Learn more about retirement planning for fitness professionals.
One of the most overlooked deductions for fitness professionals is business mileage. And one of the most common audit triggers is inadequate mileage documentation.
The problem: Most fitness pros don't track mileage consistently. They guess at year-end, which creates audit risk and leaves money on the table.
The deduction: 67 cents per business mile in 2025.
Real numbers: If you drive 10,000 business miles per year, that's a $6,700 deduction, saving you $1,500-$2,500 in taxes.
What counts as business mileage for fitness professionals:
What doesn't count:
The February action: Pick a mileage tracking method and start using it today.
Option 1: Automated tracking apps
These apps use your phone's GPS to automatically track every trip. You just swipe to categorize as business or personal.
Option 2: Manual tracking
The critical detail: You need to track starting on February 1st (or whenever you read this). You can't go back and recreate January—it's gone. But you can salvage 11 months of deductions by starting immediately.
What about January miles you didn't track? If you have calendar entries showing client appointments, competition dates, or business meetings, you can reconstruct some of January using mapping software. It's not perfect, but it's better than losing the entire month.
If you're self-employed (which most fitness professionals are), you're required to make quarterly estimated tax payments.
The deadlines for 2025:
Miss these deadlines, and you'll pay underpayment penalties—even if you pay your full tax bill when you file your return.
The February action: Calculate your 2025 estimated tax liability and set up automatic payments.
How to calculate:
Example:
Setting up automation:
You can pay estimated taxes via:
The smart move: Set up all four quarterly payments now. Schedule them in advance so you never miss a deadline.
Additional benefit: Knowing your quarterly tax obligation forces you to maintain adequate cash reserves. Too many fitness business owners spend everything they earn, then panic when tax deadlines hit.
The problem: Most fitness professionals use the "shoebox method" of receipt tracking. They collect receipts (maybe), throw them in a drawer (or shoebox), and scramble at year-end to organize everything.
This system has three fatal flaws:
The solution: Digital receipt tracking implemented in February gives you 11 months of organized records.
Option 1: Use Accounting Software with Receipt Capture
QuickBooks, Xero, and FreshBooks all offer receipt capture features. You:
Option 2: Dedicated Receipt Apps
These specialize in receipt management and integrate with accounting software.
Option 3: Simple Photo System
If you're budget-conscious:
The February action: Choose your system and start using it today. Take photos of every business purchase receipt from this point forward.
Categories to track:
Many online fitness coaches work from home but don't take the home office deduction because they think it's too complicated or risky.
The truth: The home office deduction is legitimate, valuable, and not particularly risky if you meet the requirements and document properly.
The requirements:
What qualifies for fitness professionals:
The deduction methods:
Simplified method:
Actual expense method:
Example:
The February action: If you have a home office, document it now.
Take photos showing:
Measure the space and note the square footage.
Keep this documentation with your tax records. If the IRS ever questions it, you have contemporaneous evidence.
Learn more about home office deductions for fitness coaches.
If you have kids age 10-17, hiring them in your fitness business can create legitimate tax savings.
The strategy:
Example:
The rules:
The February action: If this makes sense for your situation, start the employment relationship now.
Document:
Starting in February gives you 11 months of documented employment, which is much stronger than starting in December.
Learn more about hiring family members in your fitness business.
All of these February actions set you up for success throughout the year. But there's one absolute deadline you must hit: April 15, 2025 - Q1 estimated tax payment.
If you owe more than $1,000 in taxes for 2025 and you don't make quarterly payments, you'll face underpayment penalties—even if you pay your full tax bill when you file your 2025 return in April 2026.
The safe harbor rule: To avoid penalties, your quarterly payments must equal the lesser of:
Most people use option 2 because it's more predictable. Look at your 2024 tax return, see what you owed, and pay that amount divided by 4 each quarter.
Your February action: Calculate your Q1 payment (due April 15th) and schedule it now. Don't wait until April—schedule it today so you don't forget.
If you're reading this thinking "This is too much, I can't do all of this," I understand.
You're a fitness professional, not a tax accountant. You didn't build your gym or coaching business because you love dealing with IRS forms and quarterly payments.
Here's the reality: Trying to handle all of this yourself costs you in three ways:
The alternative: Work with a CPA who specializes in fitness businesses and handles all of this for you.
When you work with Fitness Taxes, we:
The investment: Most of our fitness professional clients pay $500-1,000/month for comprehensive tax planning, bookkeeping, and payroll.
The return: The average client saves $6,500-$12,000 per year in taxes, plus 250+ hours of their time.
The math is obvious: Spend $6,000-12,000 per year to save $6,500-12,000 in taxes PLUS reclaim 250 hours to grow your business.
Even if you break even on hard costs, you're getting 250 hours back. What's your time worth? If you charge $100/hour for training, that's $25,000 in potential revenue.
Schedule a consultation to discuss your specific situation.
Let me break this down into a manageable weekly plan:
Week 1 (February 3-9):
Week 2 (February 10-16):
Week 3 (February 17-23):
Week 4 (February 24-March 2):
By March 1st, you'll have recovered from your slow January and positioned yourself for a successful year.
Let's be brutally honest about what happens if you ignore this article and don't take action:
Scenario A: You take no action in February
Total cost: $12,000-$25,000 in lost tax savings plus penalties
Scenario B: You implement this February action plan
Total benefit: $14,000-$25,500 in tax savings
The difference between Scenario A and B: $26,000-$50,000 over the course of a year.
That's not a typo. The difference between taking action now and doing nothing is five figures.
Is February tax planning worth a few hours of your time? You tell me.
You have a choice right now.
Choice 1: Close this article, tell yourself you'll deal with it later, and go back to training clients. By March, you'll have forgotten most of this. By April, you'll miss critical deadlines. By December, you'll be scrambling with limited options.
Choice 2: Take action today. Start with one thing—file your S-Corp election, set up your mileage tracker, establish your retirement account. Build momentum. Get your finances under control.
Choice 3: Schedule a consultation with Fitness Taxes and let us handle all of this for you. We'll file your S-Corp election, set up your payroll, establish your retirement account, implement tracking systems, and handle everything on this list.
The fitness professionals who build real wealth are the ones who take Choice 2 or Choice 3. They're not smarter or more talented—they're just more strategic about their finances.
Don't let another month pass while you're overpaying taxes and missing opportunities.
Take action now. Schedule your consultation.
Fitness Taxes is a specialized division of Asnani CPA, providing tax preparation, bookkeeping, payroll services, and proactive tax planning exclusively for fitness professionals. We help gym owners, personal trainers, and CrossFit coaches implement Q1 tax strategies that save thousands in taxes while simplifying their financial lives. Learn more about our services.
