Year-End Tax Planning for 2026

1. Harvest losses to offset gains

If any of your taxable investments are down for the year, selling them can offset capital gains elsewhere in your portfolio and reduce your taxable income. If your losses exceed your gains, up to $3,000 can offset ordinary income each year, with the rest carried forward to future years. This one hasn’t changed under the new law, but it’s still one of the more overlooked strategies simply because it requires looking at the whole portfolio together rather than one account at a time.

2. Revisit your retirement contributions, including a new wrinkle for high earners

Contribution limits are higher again in 2026. The 401(k) elective deferral limit rises to $24,500, and the IRA limit moves to $7,500. Catch-up contributions for those 50 and older increase to $8,000 for workplace plans and $1,100 for IRAs, and the enhanced catch-up for ages 60 through 63 holds at $11,250.

There’s a change worth flagging for higher-income clients specifically. Starting in 2026, employees who earned more than $150,000 in wages the prior year and want to make catch-up contributions to a workplace plan must direct those catch-up dollars to a Roth account rather than a traditional, pre-tax one. It doesn’t reduce how much you can contribute, but it does change the tax treatment, so it’s worth confirming with your plan administrator how this applies to your specific account before year-end.

3. Approach charitable giving with the new rules in mind

Charitable giving looks different under the new law than it did even a year ago. Itemizers now face a 0.5% of adjusted gross income floor on charitable deductions, meaning the first portion of your giving each year doesn’t generate a deduction. At the same time, those who don’t itemize can now claim a deduction of up to $1,000 (single) or $2,000 (joint) for cash gifts, a benefit that didn’t exist before.

For clients who give consistently, this may be a good year to talk through the mechanics: whether bunching multiple years of giving into 2026 makes sense, whether a donor-advised fund fits your situation, and how gifts of appreciated securities compare to cash under the new floor. The right approach depends heavily on your income and giving pattern, so this is one area where a conversation tends to be more useful than a general rule.

4. Confirm your RMD, and consider a QCD

If you’re required to take a required minimum distribution this year, confirm the amount and the deadline. Missing an RMD can trigger a penalty, and the rules around the age at which RMDs begin have shifted in recent years under SECURE 2.0, so it’s worth double-checking rather than assuming last year’s timeline still applies.

If you’re charitably inclined and RMD age, a qualified charitable distribution lets you send up to $111,000 in 2026 directly from your IRA to a qualifying charity. That amount counts toward your RMD but isn’t included in your taxable income, which can help even if you don’t itemize.

5. Take a fresh look at your portfolio

Year-end is a natural checkpoint to see whether your portfolio still reflects your goals and risk tolerance, not just your original plan from a few years ago. Markets move throughout the year, and an allocation that made sense in January may look different by December. Rebalancing can also be an opportunity to pair with the loss-harvesting strategy above, so it often makes sense to look at both together.

6. Think about filling up your bracket, including Roth conversions

With the seven-bracket structure and current rates now made permanent under the new law, there’s more certainty than usual for multi-year tax planning. That stability can make it easier to think through whether recognizing additional income this year, through a Roth conversion or otherwise, makes sense for your situation, particularly if you expect to be in a similar or higher bracket down the road.

Making a plan before the year runs out

Tax rules shift more than most people expect, and this year shifted more than most. None of these strategies work quite the same for every household, since so much depends on your income, your accounts, and your goals for the years ahead. If any of this raises a question about your own situation, let’s find time before December to walk through it together.