Year-End Tax Planning
Your 2026 Checklist Before December 31
What Is Year-End Tax Planning?
QUICK ANSWER
Year-end tax planning means making tax moves before December 31 that lower this year’s bill or future taxes. For 2026, the biggest levers are Roth conversions, gain and loss harvesting, and maxing out retirement plans. In addition, retirees should plan their RMDs and qualified charitable distributions. Finally, new 2026 rules on charitable gifts, Roth catch-ups, and the SALT cap change the math for many households.
Why Year-End Tax Planning Matters More in 2026
Year-end tax planning matters more in 2026 than in most years. The One Big Beautiful Bill Act (OBBBA) made today’s tax brackets permanent. However, it also added new deductions, new limits, and new phase-outs. As a result, two households with the same income can owe very different amounts. Often, the difference comes down to what each one does before December 31.
At BANDER Wealth Management, our CFP® professionals work alongside in-house CPAs. Together, we help clients coordinate taxes, investments, and retirement income. We have offices in Idaho Falls, Boise, Denver, Provo, and Gilbert. Even so, we serve clients nationwide through secure virtual meetings. This guide covers the key 2026 numbers, the deadlines that matter, and the moves worth making now.
What Changed for Year-End Tax Planning in 2026
Several federal changes took effect on January 1, 2026. Consequently, last year’s playbook may not fit this year.
- Permanent brackets. OBBBA locked in the 10% through 37% rates. So, there’s no longer a rush to convert or realize income before a “sunset.” Instead, the real question is whether this year’s rate beats your expected future rate.
- A bigger standard deduction. According to the IRS 2026 inflation adjustments, it rose to $16,100 for single filers and $32,200 for joint filers.
- A new senior deduction. Taxpayers 65 and older can deduct up to $6,000 each through 2028. However, it phases out above $75,000 of MAGI ($150,000 joint).
- A higher SALT cap. The state and local tax deduction cap rose to $40,400. Yet it shrinks for households with MAGI above $505,000, though never below $10,000.
- New charitable rules. Itemizers now face a floor equal to 0.5% of AGI on gifts. Meanwhile, non-itemizers can deduct up to $1,000 in cash gifts ($2,000 joint).
- Mandatory Roth catch-ups. Some workers age 50 and older must now make catch-ups as Roth. This applies if 2025 Social Security wages from that employer topped $150,000.
Key 2026 Numbers for Year-End Tax Planning
Keep these figures handy as you plan. Each one marks a line that a single year-end move can cross.
| Item | 2026 Amount |
|---|---|
| Standard deduction | $16,100 single / $32,200 joint |
| Top of the 12% bracket | $50,400 single / $100,800 joint |
| Top of the 22% bracket | $105,700 single / $211,400 joint |
| 0% long-term capital gains rate | Taxable income up to $49,450 single / $98,900 joint |
| 401(k), 403(b), and 457(b) deferrals | $24,500, plus $8,000 catch-up at age 50+ |
| Super catch-up, ages 60 to 63 | $11,250 |
| IRA contributions | $7,500, plus $1,100 catch-up at age 50+ |
| HSA contributions | $4,400 self-only / $8,750 family, plus $1,000 at age 55+ |
| Qualified charitable distributions | $111,000 per person |
| Annual gift exclusion | $19,000 per recipient |
| Estate tax exclusion | $15 million per person |
The retirement plan and QCD limits come from IRS Notice 2025-67. The bracket and gift figures come from the IRS inflation release linked above.
Year-End Tax Planning Deadlines to Know
Most moves must happen by December 31. However, a few deadlines fall in 2027.
| Deadline | What Must Happen |
|---|---|
| December 31, 2026 | Roth conversions, RMDs, QCDs, gain and loss harvesting, 401(k) deferrals, and charitable gifts |
| December 31, 2026 | Annual exclusion gifts and 2026 Trump Account contributions |
| January 15, 2027 | Fourth-quarter estimated tax payment for 2026 |
| April 1, 2027 | First RMD for IRA owners who turned 73 in 2026 |
| April 15, 2027 | 2026 IRA and HSA contributions; file or extend your return |
In practice, “by December 31” often means earlier. Custodians need time to process conversions, QCDs, and stock transfers. So, aim to finish those moves by mid-December.
Nine Year-End Tax Planning Moves for 2026
Most households will use three or four of these moves, not all nine. Also, the moves often work best in combination.
1. Fill Your Tax Bracket With a Roth Conversion
A Roth conversion moves money from a traditional IRA into a Roth IRA. You pay tax on the converted amount now. In return, qualified withdrawals come out tax-free later. The best time to convert is often a year with room left in a lower bracket. Conversions must finish by December 31, and you can’t undo them. Our guide to Roth conversion strategies explains how to size a conversion.
2. Harvest Gains at 0% or Harvest Losses
Taxable accounts offer two year-end opportunities. First, joint filers with taxable income below $98,900 may realize long-term gains at a 0% federal rate. That resets your cost basis higher without a tax bill.
Second, you can sell investments at a loss to offset gains elsewhere. Losses beyond your gains can offset up to $3,000 of ordinary income each year. After that, unused losses carry forward. In 2026, rising Treasury yields have pushed some bond funds below their purchase price. Therefore, bond positions may be a natural place to look. Just avoid buying a substantially identical investment within 30 days. Otherwise, the wash-sale rule will disallow the loss.
3. Max Out Workplace Retirement Plans
Deferrals to a 401(k), 403(b), or 457(b) must come out of 2026 paychecks. So, check your year-to-date total now, while you can still raise your contribution rate. The 2026 limit is $24,500. On top of that, savers age 50 and older can add $8,000. Those turning 60 to 63 this year can add $11,250 instead.
However, a new rule applies to higher earners. If your 2025 Social Security wages topped $150,000, your 2026 catch-ups must go into a Roth account. That means no current deduction on those dollars. Still, they can grow tax-free for retirement. If your plan lacks a Roth option, you may not be able to make catch-ups at all. Tech employees should also coordinate deferrals with RSU vesting and ESPP purchases. Our tech employee financial planning guide covers how equity pay fits in.
4. Take RMDs and Consider QCDs
Required minimum distributions (RMDs) generally start at age 73, or 75 for anyone born in 1960 or later. If you miss one, you’ll owe a 25% excise tax. That penalty drops to 10% if you correct the mistake quickly. Most RMDs must come out by December 31. However, your first RMD can wait until April 1 of the following year. Waiting means two RMDs in one tax year, though.
If you give to charity, a qualified charitable distribution (QCD) can satisfy your RMD tax-free. You must be at least 70½, and the 2026 limit is $111,000 per person. Our post on qualified charitable distributions walks through the steps. Heirs who inherited an IRA after 2019 should check their accounts too. Many of them now owe annual withdrawals within the 10-year rule.
5. Manage Your MAGI Around Key Thresholds
Modified adjusted gross income (MAGI) drives several 2026 benefits and surcharges. As a result, one extra dollar of income can cost far more than your tax rate suggests. Before you add income from a conversion or a sale, check these lines:
-
- The senior deduction begins to phase out above $75,000 of MAGI ($150,000 joint). Our post on the 2026 senior tax cliff shows how quickly it shrinks.
- Medicare IRMAA surcharges use a two-year lookback. So, your 2026 income sets your 2028 Part B and Part D premiums.
- The SALT cap starts shrinking once MAGI passes $505,000.
- The 3.8% net investment income tax applies above $200,000 of MAGI for single filers ($250,000 joint).
6. Plan Charitable Gifts Under the New Rules
Under the 2026 charitable rules, planning pays off. For instance, bunching several years of gifts into a donor-advised fund can clear the new 0.5% floor. Likewise, donating appreciated stock avoids capital gains tax on the growth. Top-bracket donors should also note that deductions now save at most about 35 cents per dollar. Our guide to charitable giving tax strategies compares every option. Stock transfers can take one to two weeks, so start early.
7. Make Annual Gifts to Family
In 2026, you can give up to $19,000 per recipient without filing a gift tax return. Married couples who each give can move $38,000 per recipient. These gifts also shrink your future taxable estate.
In addition, gifts for children can fund a 529 plan or a Trump Account. Total Trump Account contributions can’t exceed $5,000 per child per year. Our overview of Trump Accounts explains who qualifies for the $1,000 federal seed deposit. For larger estates, the $15 million exclusion now stays in place rather than dropping by half. Therefore, estate plans built around a 2026 sunset deserve a fresh look. Our guide on how to reduce estate taxes covers the next steps.
8. Check Withholding and Estimated Payments
Underpaying during the year can trigger an IRS penalty, even if you pay in full by April. To avoid it, pay at least 90% of this year’s tax or 100% of last year’s. That second figure rises to 110% if your prior-year AGI topped $150,000.
Year-end income spikes can upset those targets. So, review your withholding after any large conversion, bonus, or sale. W-2 employees have a useful edge here. Extra withholding in December counts as if you paid it evenly all year. Our post on the Q3 estimated tax deadline explains the safe harbor rules in more detail.
9. Time Income and Deductions in Your Business
Business owners control timing more than most taxpayers. For example, you may be able to delay invoices or prepay certain expenses. OBBBA also restored 100% bonus depreciation and raised Section 179 limits. As a result, equipment you place in service by December 31 may be fully deductible this year.
However, a big deduction isn’t always the right answer. Sometimes it’s better to spread income evenly across several years. If a sale is on the horizon, timing matters even more. Our business owner exit planning guide covers pre-sale tax moves.
How to Build Your Year-End Tax Planning Checklist
Good year-end tax planning follows a simple sequence. Here are the five steps.
- Project your 2026 income. Gather pay stubs, brokerage statements, and business results. Then estimate your total income and deductions for the year.
- Map your income against key thresholds. Compare your estimate with the bracket, capital gains, IRMAA, and senior deduction lines. Note how much room you have before each one.
- Choose your moves. Pick the strategies that fit your gaps, such as a Roth conversion or a gain harvest. Meanwhile, avoid moves that push you over a costly line.
- Schedule the transactions early. Submit conversions, QCDs, and stock gifts by early December. That way, custodians have time to finish before December 31.
- Confirm with your CPA and keep records. Have your tax professional review the plan before you act. Afterward, save confirmations and charity receipts for your return.
Example: Suppose a married couple expects $150,000 of taxable income in 2026. The 22% bracket tops out at $211,400. So, they could convert about $61,000 without leaving the 22% bracket. However, that conversion would also raise their MAGI. Therefore, they should first check whether it would trigger IRMAA or shrink the senior deduction.
Common Year-End Tax Planning Scenarios
Every household is different. Still, a few situations come up often in our planning conversations.
“I just retired, and I’m not taking RMDs yet.”
The years between retirement and RMDs are often a low-income window. So, they can be a strong time for Roth conversions or 0% gain harvesting. Delaying Social Security can widen that window further. Our Social Security claiming strategy guide explains the trade-offs.
“I’m over 73, and my RMDs push my income up.”
QCDs are usually the first tool here. Next, check whether your income sits just above an IRMAA bracket. Our IRMAA planning strategies guide shows how the two-year lookback works.
“I’m an executive with a large bonus or RSU vest this year.”
High-income years call for deduction-heavy moves, such as bunching gifts into a donor-advised fund. Also, watch the Roth catch-up rule and the 110% safe harbor. Our executive financial planning guide adds the NQDC and trading-window layers.
“I own a medical or dental practice.”
Practice owners can often shift income and expenses between years. In addition, a larger retirement plan can shelter much more income. Our physician and dentist financial planning guide explains how these pieces fit together.
“We’re moving to another state.”
Your residency dates can decide which state taxes your income. For example, moving before a large sale may change which state can tax that gain. However, states look closely at residency changes. Our guide to relocating to the Mountain West covers the residency rules for Idaho, Utah, Colorado, and Arizona.
Why Clients Work With BANDER on Year-End Tax Planning
Year-end tax planning works best when your advisor and your CPA share one plan. Too often, an advisor makes a December move that the tax preparer only discovers in April. BANDER closes that gap by pairing CFP® advisors with in-house CPAs through BANDER Accounting Group. As a result, your conversions, gifts, and estimated payments all come from one coordinated team.
We serve clients from offices in Idaho, Utah, Colorado, and Arizona. In addition, we work with families and business owners in every state through virtual meetings. So, wherever you live, we can help you act before December 31.
Frequently Asked Questions
When should I start year-end tax planning?
Ideally, start in September or October. By then, you can estimate your full-year income with confidence. Starting early also leaves time for transactions that take weeks to settle.
What is the deadline for a Roth conversion in 2026?
The deadline is December 31, 2026. Unlike IRA contributions, a conversion finished in 2027 can’t count for 2026. Also, you can no longer undo a conversion after the fact.
Can I still contribute to an IRA for 2026 after December 31?
Yes. You can make 2026 IRA and HSA contributions until April 15, 2027. However, 401(k) deferrals must come from 2026 paychecks.
What is the 0% capital gains threshold for 2026?
The 0% rate applies while taxable income stays at or below $49,450 for single filers. For joint filers, the line is $98,900. Above those amounts, the federal rate on long-term gains rises to 15%.
How much in capital losses can I deduct?
Capital losses first offset your capital gains. Then up to $3,000 of extra losses can offset ordinary income each year. You can carry any remaining losses forward indefinitely.
Do I have to make my 401(k) catch-up contributions as Roth?
Only if your 2025 Social Security wages from that employer topped $150,000. In that case, your 2026 catch-ups must go in as Roth. Everyone else can still choose pre-tax or Roth.
How much can I give to family without paying gift tax?
You can give $19,000 per recipient in 2026 without touching your lifetime exclusion. Larger gifts require a gift tax return. However, tax is rarely due, since the lifetime exclusion is $15 million.
Does BANDER help with year-end tax planning outside Idaho, Utah, Colorado, and Arizona?
Yes. BANDER works with clients nationwide through virtual meetings. Our CFP® advisors and in-house CPAs coordinate year-end moves wherever you live.
