5 Year-End Tax Moves to Make Before December 31st

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Most people think of taxes as an April problem.

That's exactly why most people leave money on the table.

The most powerful tax moves — Roth conversions, tax-loss harvesting, retirement account contributions, charitable deductions — have a December 31st deadline, not April 15th. By the time spring rolls around, those windows are closed.

Here are five tax moves you should be making right now, before the year ends.

Why December 31st Is the Real Tax Deadline

April 15th is when you file your taxes. But for most tax-reducing strategies, the action has to happen by December 31st of the tax year in question.

Exceptions:

IRA contributions: You have until the tax filing deadline (April 15th, or October 15th with extension)
HSA contributions: Same — April 15th

But for everything else — Roth conversions, 401(k) contributions through payroll, tax-loss harvesting, charitable giving — you have until December 31st. Period.

Start planning in September. Act in October and November. Don't scramble in late December.

Move #1: Do a Roth Conversion Before the Bracket Shifts

What it is: A Roth conversion means moving money from a traditional IRA (or 401k) — where contributions were pre-tax — into a Roth IRA, where future growth and withdrawals are tax-free. You pay income tax on the converted amount now.

Why do it before year-end? Because you're trying to "fill your tax bracket." The goal is to convert just enough to bring your taxable income up to the top of your current bracket — but not into the next one.

2026 Tax Bracket Reference

| Tax Rate | Single Filer | Married Filing Jointly | |---|---|---| | 10% | $0 – $11,925 | $0 – $23,850 | | 12% | $11,926 – $48,475 | $23,851 – $96,950 | | 22% | $48,476 – $103,350 | $96,951 – $206,700 | | 24% | $103,351 – $197,300 | $206,701 – $394,600 | | 32% | $197,301 – $250,525 | $394,601 – $501,050 | | 35% | $250,526 – $626,350 | $501,051 – $751,600 | | 37% | Over $626,350 | Over $751,600 |

(2026 IRS figures, adjusted for inflation)

Example: You're a single filer with $38,000 in taxable income. The 12% bracket goes up to $48,475. You could convert up to $10,475 from your traditional IRA to a Roth IRA and pay only 12% on every dollar of that conversion. Every dollar in your Roth now grows tax-free forever.

Why this matters more in 2026: The current Tax Cuts and Jobs Act lower rates are scheduled to expire after 2025 (though legislation continues to evolve). If rates increase in future years, the cost of a Roth conversion goes up. Converting at today's rates may lock in significant long-term savings.

Who this is for: Anyone with a traditional IRA or old 401(k), especially in a lower-income year (job change, early retirement, business loss year, or a year with large deductions).

(For a deeper dive, see our full Backdoor Roth IRA Guide coming in Week 2)

Move #2: Max Out Your Retirement Accounts

If you haven't maxed out your retirement contributions this year, you still have time — but only for employer-sponsored plans (401k, 403b) until December 31st.

2026 IRS Retirement Contribution Limits

| Account | 2026 Limit | Catch-Up (Age 50+) | |---|---|---| | 401(k) / 403(b) | $24,500 | +$7,500 (total $31,000) | | IRA (Traditional or Roth) | $7,000 | +$1,000 (total $8,000) | | SIMPLE IRA | $16,500 | +$3,500 (total $20,000) | | SEP-IRA | 25% of compensation, up to $72,000 | N/A | | HSA (individual) | $4,400 | +$1,000 at age 55+ | | HSA (family) | $8,750 | +$1,000 at age 55+ |

401(k) note: Your contributions must go through payroll deductions, which means you have to increase your contribution percentage before your last paycheck of the year. If you're paid bi-weekly, you may have only 2-3 payroll cycles left in Q4. Don't miss the window.

IRA note: You have until April 15, 2027 to make a 2026 IRA contribution. But contributing early gives your money more time to compound, and you don't have to scramble in the spring.

The math: If you're in the 22% federal bracket and you contribute an additional $5,000 to a traditional 401(k) before year-end, you reduce your federal tax bill by $1,100 this year. State taxes on top of that.

Move #3: Harvest Tax Losses to Offset Gains

What it is: Tax-loss harvesting means selling investments that are currently at a loss to "realize" that loss for tax purposes. Those losses offset your capital gains — and up to $3,000 of ordinary income per year.

Why now? You need to sell the investment before December 31st for the loss to count in the current tax year. After year-end, it's too late.

How Tax-Loss Harvesting Works

Let's say you have:

Gain: You sold Apple stock earlier this year for a $8,000 long-term capital gain
Loss: You hold some biotech ETF that's down $5,000 from your cost basis

If you sell the biotech ETF before December 31st, you realize a $5,000 loss. That $5,000 offsets your $8,000 gain — you only pay capital gains tax on $3,000 instead of $8,000.

At the 15% long-term capital gains rate: You save $750 in taxes from that one transaction.

The Wash-Sale Rule — Don't Step on This Trap

The IRS won't let you sell an investment for a loss and immediately buy it back. The wash-sale rule says if you buy a "substantially identical" security within 30 days before or after the sale, the loss is disallowed.

What you can do:

Wait 31 days before repurchasing the same investment
Immediately buy a similar-but-not-identical investment (sell a Vanguard S&P 500 ETF, immediately buy a Fidelity S&P 500 ETF — different fund, same exposure)
Invest the proceeds in a different sector or asset class

The goal is to maintain your market exposure while capturing the tax loss.

2026 Capital Gains Tax Rates

| Long-Term Gains | Single Filer | Married Filing Jointly | |---|---|---| | 0% | Up to $47,025 | Up to $94,050 | | 15% | $47,026 – $518,900 | $94,051 – $583,750 | | 20% | Over $518,900 | Over $583,750 |

Short-term capital gains (held under 1 year) are taxed as ordinary income at your marginal rate.

Move #4: Give Smarter — Bunching Charitable Deductions

The 2026 standard deduction is $15,000 for single filers and $30,000 for married filing jointly (estimated with inflation adjustment). This high threshold means most people don't itemize — which means most charitable donations produce zero tax benefit.

The bunching strategy: Instead of giving $2,000/year to charity every year, give $4,000 every two years (or $6,000 every three years). In the giving year, you itemize and deduct the larger amount; in the off years, you take the standard deduction.

Even more powerful: Open a Donor-Advised Fund (DAF). You contribute a lump sum to the DAF this year, get the full tax deduction now, then grant the money out to your chosen charities over multiple years — on your timeline.

If you're 70½ or older: See Move #5 — the Qualified Charitable Distribution is even better.

2026 Charitable Deduction Limits

Cash donations to public charities: up to 60% of AGI
Appreciated stock donations: up to 30% of AGI (but you avoid capital gains on the appreciation too — a double benefit)
Donations to private foundations: up to 30% of AGI

Move #5: If You're 70½+, Use a Qualified Charitable Distribution (QCD) Instead

This is the most tax-efficient charitable giving strategy most people have never used.

A Qualified Charitable Distribution (QCD) lets you transfer money directly from your IRA to a qualified charity — up to $105,000 in 2026 (indexed for inflation from the $100,000 base; verify the exact 2026 figure at irs.gov when finalized) — without ever recognizing it as taxable income.

This is different from, and better than, a regular charitable deduction:

| | Regular Charitable Donation | QCD | |---|---|---| | IRA withdrawal taxable? | Yes | No | | Tax benefit requires itemizing? | Yes | No | | Counts toward RMD? | No | Yes |

If you have Required Minimum Distributions (RMDs) — mandatory annual withdrawals from your IRA starting at age 73 — a QCD satisfies your RMD without adding a dollar to your taxable income. That means:

No income tax on the RMD amount
No impact on your Medicare premium (which rises with income)
No impact on how much of your Social Security is taxable
You still benefit your charity

2026 QCD Limit: $105,000 per person (indexed for inflation from $100,000 base; verify exact 2026 figure at irs.gov). Married couples can each do $105,000 from their respective IRAs — up to $210,000 total.

Requirements:

You must be 70½ or older
The distribution must go directly from the IRA to the charity (not to you first)
The charity must be a 501(c)(3) public charity (not a DAF, private foundation, or supporting organization)

(For a full deep-dive on QCDs with step-by-step instructions, see our dedicated guide: QCDs Explained: How to Make Tax-Free Charitable Donations from Your IRA)

Your Year-End Tax Checklist

Use this before December 31st:

[ ] Roth conversion: Calculate how much headroom you have in your current bracket. Convert up to that amount.
[ ] 401(k) contributions: Increase contribution percentage immediately if you haven't maxed out. Check your final paycheck dates.
[ ] Tax-loss harvesting: Review portfolio for unrealized losses. Identify offset opportunities. Watch wash-sale window.
[ ] Charitable bunching: Decide whether to give in 2026 or 2027 based on which year you can itemize. Consider a DAF.
[ ] QCD (if 70½+): Contact your IRA custodian about a direct charitable transfer before December 31st.
[ ] RMD check (if 73+): Make sure you've taken your full Required Minimum Distribution for the year. Penalty for missing it: 25% of the amount you should have withdrawn.
[ ] HSA contribution: If you're on an HDHP, have you contributed the max? You have until April 15 for 2026 contributions, but funding now means more investment time.
[ ] 529 contributions: Many states offer deductions for 529 contributions made by December 31st. Check your state's rules.

Model Your Tax Savings

Want to see exactly how much a Roth conversion, additional 401(k) contribution, or tax-loss harvest would save you?

Run the numbers at valueofstock.com/calculator — our free tax savings tool models the impact across different income levels and tax brackets.

Get Your Financial House in Order

Implementing these tax moves is easier when your full financial picture is in one place. Track your net worth, investment accounts, and retirement progress with a free dashboard:

Empower — Free financial dashboard with retirement planner, fee analyzer, and investment checkup tools

The Bottom Line

The gap between a mediocre tax outcome and a great one often comes down to acting before December 31st. Roth conversions, retirement contributions, tax-loss harvesting, and charitable strategies aren't complicated — but they have hard deadlines.

The people who win at taxes don't work harder. They plan earlier.

Take It Further

Want a complete year-end tax planning worksheet — including a Roth conversion calculator, tax-loss harvesting tracker, and charitable giving optimizer?

Download the Year-End Tax Planning Kit on Gumroad → — everything you need to close out the year with confidence.

Financial Disclaimer: This article is for educational purposes only and does not constitute tax, financial, or legal advice. Tax laws change frequently and the rules described are based on 2026 IRS guidance. Individual tax situations vary significantly. The Roth conversion strategies, capital gains rates, and retirement contribution limits referenced are subject to change. Always consult a qualified CPA, tax attorney, or financial advisor before executing tax planning strategies. Nothing in this article should be construed as a recommendation to take any specific tax action.