Quick Summary: Charlotte is home to one of North Carolina’s fastest-growing business hubs—and with income tax changes in 2025, the opportunities to plan ahead (and save big) are real. Whether you’re an LLC, S Corp, or C Corp, here’s how to adjust your strategy before year-end.
1. Why 2025 Matters for Charlotte Entrepreneurs
With the NC flat personal income tax rate now at 4.25%—and a drop to 3.99% coming in 2026—business owners who plan ahead can benefit for years. At the same time, NC’s corporate income tax rate has dropped to 2.25%, with a full phase-out by 2030.
Timing is everything. With the right strategy, you can:
- Delay income until 2026 if you’re taxed as an individual
- Accelerate expenses to 2025 if you’re a C Corp
- Restructure your entity to take advantage of lower business taxes
2. NC Corporate Tax Phase-Out: What It Means
Charlotte-based C Corps are in a unique position to benefit. Unlike most states, North Carolina is phasing out corporate income tax entirely by 2030.
This opens the door to:
- Long-term planning for business asset sales
- Revisiting your entity structure
- Coordinating shareholder compensation and dividends
Note: If you’re not reviewing this annually with a qualified advisor, you’re leaving money on the table.
3. LLC, S Corp, or C Corp—What’s Right in 2025?
Too many Charlotte businesses operate under the wrong entity type for their income level.
- LLCs are simple but offer no SE tax reduction
- S Corps allow payroll + distribution structure
- C Corps now offer the lowest flat rate in the country—but carry double taxation risks
📌 Explore our guide on choosing the right business entity »
4. Tax Projections: The Tool Most Firms Skip
Your tax return is history. Your tax projection is strategy.
With a midyear projection, you can:
- Adjust estimated payments to free up cash
- Fund retirement accounts at the optimal time
- Avoid nasty April surprises from unexpected gains
📌 Understand the difference: Tax Projections vs. Prep »
5. Strategic Deductions You Can Still Claim in 2025
Before December 31, consider:
- Equipment purchases (Section 179, bonus depreciation)
- Prepaid vendor services
- Qualified retirement plan contributions
- Clean-up of bad debt and AR adjustments
Reminder: Deductions are only as strong as the books behind them. Garbage in = audit risk.
📌 Need reliable monthly bookkeeping? Start here »
6. Charlotte Growth = IRS Attention
With growth comes oversight. Charlotte businesses are already seeing:
- More aggressive IRS notices
- CP2000 and underreporting challenges
- Increased audits of S Corps with poor books
📌 Read: What to do if you get a notice from the IRS »
7. Final Thoughts: Charlotte Needs More Than Just Tax Prep
At Polaris, we don’t just file your return—we help build your strategy.
If you run a business in Charlotte and want:
- Smarter tax planning
- Real financial clarity
- Proactive IRS defense
…then you’re our kind of client.
📅 Schedule a confidential review today and let’s make 2025 the year you stop leaving money on the table.