The last few weeks of the year can offer some final opportunities to shape your tax outlook—not just for this year, but for years to come. December shouldn’t be a scramble—it should be intentional. This is the moment you can align your financial picture with year-end deadlines, market conditions, and the shifting tax landscape. These last-minute moves can help you enter the new year with clarity, confidence, and control.
Let’s walk through the top end-of-year tax planning tips worth reviewing before December 31, so you can make informed decisions that help to protect your wealth and support your goals well into the future. Just keep in mind that the One Big Beautiful Bill Act (OBBBA) includes new deductions with income-based phaseouts, so it’s important to consider these limitations when implementing strategies.
Tip 1: Finish taking any remaining required minimum distributions (RMDs).
All required withdrawals must be completed by December 31 to avoid penalties. Don’t forget about inherited IRAs and be aware of the 10-year rule, as the SECURE Act eliminated “stretch IRAs” for many beneficiaries.
Tip 2: Maximize your retirement plan contributions.
Consider increasing your contributions to retirement accounts such as 401(k)s, 403(b)s, and IRAs. For traditional and Roth IRAs, you have an extended period of time—any contributions made by April 15 of next year can be attributed to this year.
Tip 3: Take advantage of the 401(k) catch-up, if eligible.
If you’re 50 or older by the end of the calendar year, you have the opportunity to make catch-up contributions to your 401(k). For 2025, the limit is $7,500 for most individuals who qualify. If you are aged 60 to 63, however, you could be eligible for a “super catch-up” with a limit of $11,250.
Tip 4: Consider a Roth conversion.
This strategy may be worth exploring if you’re in a lower-than-usually tax bracket this year or if you expect your taxes to increase in the future. You can convert funds from a traditional IRA or 401(k) into a Roth account and pay taxes on converted amount now, allowing those funds to grow tax-free and then be distributed tax-free. This approach can create tax diversity across your retirement income streams while also delivering the potential for tax advantages if the asset passes to heirs.
To get the benefits of the conversion for this tax year, make sure the conversion is completed by December 31. But also be mindful that any Roth conversions could increase income and therefore decrease the ability to take certain OBBBA deductions.
Tip 5: Look for opportunities for tax-loss harvesting.
By strategically selling underperforming investments, you can generate losses that offset capital gains and potentially reduce your tax liability. In certain situations, you could benefit from realizing investment losses where appropriate to help offset gains. Given the complexity involved, consider working with an advisor to determine if this strategy aligns with your financial goals.
Tip 6: Submit your flexible spending account expenses.
An FSA can be a powerful tax-saving tool—but only if you remember to use it. Generally, you need to spend those FSA dollars within the plan year or lose them. Your employer may offer either a 2.5-month grace period or a carryover of up to $660 into the next year, but not both. If neither option is available, you forfeit any unused funds at the end of the plan year. Check your plan’s rules to understand your options.
Tip 7: Make charitable contributions.
Charitable giving offers numerous opportunities for tax advantages, but navigating the strategies can be complex. Options include donating appreciated securities to potentially avoid capital gains tax, bunching multiple years of contributions into one year to maximize deductions, utilizing qualified charitable distributions (QCDs) from your IRA if you’re 70½ or older, and leveraging donor-advised funds (DAFs) for tax-efficient giving over time.
For high-income earners, making charitable contributions in 2025 is especially important due to significant tax law changes taking effect in 2026. Starting next year, the maximum federal tax benefit for charitable deductions will be capped at 35%, making this year’s contributions substantially more valuable for those in the top tax bracket. Additionally, 2026 will introduce a charitable contribution “floor,” requiring that only contributions exceeding 0.5% of your AGI will be deductible, regardless of income level. These combined changes mean that high-income itemizers may receive considerably lower tax benefits from charitable giving starting next year, making 2025 an important window for maximizing the impact of your charitable contributions.
The timing strategy for your charitable giving also depends on whether you itemize deductions. If you currently itemize, it may make sense to accelerate or bunch contributions into 2025 to avoid the 0.5% AGI floor that takes effect in 2026. However, if you don’t itemize, deferring contributions to 2026 could be advantageous, as new legislation will provide a $1,000 deduction for single filers ($2,000 for married filing jointly), even for those taking the standard deduction. A financial advisor can help determine the best approach for your situation.
Tip 8: Fund your child’s 529 account.
Consistently funding a 529 account each year allows your contributions to grow tax-free, and the power of compounding means even modest early contributions can significantly reduce future education costs. The OBBBA also made 529 college savings plans more flexible by expanding the list of education-related expenses that qualify for tax-free withdrawals. For example, 529s can now be used for expenses like books, tutoring fees, and college-prep materials for K–12 students.
While there is no federal deduction for 529 plan contributions, many states allow a state income tax deduction. Check to see if your state offers this deduction and what the limits are.
Tip 9: Take advantage of annual gift tax exclusions.
If you are planning to make gifts to loved ones or you are a high net worth individual, consider taking advantage of the annual gift tax exclusion, which allows you to give up to $19,000 per recipient tax-free. To ensure these gifts count toward this calendar year’s exclusion, make sure they are distributed by December 31.
Tip 10: Take advantage of OBBBA incentives for business owners.
The OBBBA significantly improved potential tax benefits for business owners. The QBI deduction allows pass-through business owners (sole proprietors, partnerships, S-Corps, LLCs) to generally deduct 20% of net business income on their individual tax return—this benefit is now permanent. Income limits may reduce or eliminate this deduction, but these thresholds are slightly higher starting in 2026.
The law also restored 100% bonus depreciation for qualified property purchased on or after January 19, 2025. Section 179 allows small businesses to deduct the full cost of acquiring property in that tax year instead of spreading the cost over multiple years. That maximum deduction increased for 2025 from $1.25 million to $2.5 million, and the phase-out threshold rose from $2.5 million to $4 million.
Business owners should work with their tax professionals now to manage income strategically and take advantage of these expanded expense deductions and other business incentives for the current tax year.
Start Your Year-End Planning Now
We hope these 10 year-end planning tips have been helpful. If you’ve already tackled everything on your list, don’t stop now—get a head start on 2026 planning!
Keep in mind that everyone’s situation is different, so not every strategy will be relevant for you. If you’d like to discuss which opportunities make sense for your circumstances and could provide real benefits before year-end, we’re here to help.
Debra Taylor is not registered with Cetera Wealth Services LLC. Any information provided by this individual is provided entirely on behalf of CWM, LLC and is in no way related to Cetera Wealth Services LLC or its registered representatives.
Distributions from traditional IRAs and employer sponsored retirement plans are taxed as ordinary income and, if taken prior to reaching age 59 ½, may be subject to an additional 10% IRS tax penalty.
Converting from a traditional IRA to a Roth IRA is a taxable event.
Generally, a donor-advised fund is a separately identified fund or account that is maintained and operated by a section 501(c)(3) organization, which is called a sponsoring organization. Each account is composed of contributions made by individual donors. Once the donor makes the contribution, the organization has legal control over it. However, the donor, or the donor’s representative, retains advisory privileges with respect to the distribution of funds and the investment of assets in the account. Donors take a tax deduction for all contributions at the time they are made, even though the money may not be dispersed to a charity until much later.
Investors should also consider whether the investor’s or beneficiary’s home state offers any state tax or other benefits available only from that state’s 529 Plan. Any state-based benefit should be one of many appropriately weighted factors in making an investment decision. The investor should consult their financial or tax advisor before investment in any state’s 529 Plan.
This article is not intended to provide specific legal, tax, or other professional advice. For a comprehensive review of your personal situation, always consult with a tax or legal advisor.
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