What is the most important year-end tax move?

There is no single move for everyone. For most employees it is making sure retirement deferrals and any health account contributions are maximized or at least match-eligible; for investors it is reviewing gains and losses; for retirees it is taking required distributions.

Can I still reduce my 2026 taxes in January?

Yes, a few ways: IRA and HSA contributions for 2026 can be made until the April 2027 filing deadline. Most other moves, such as sales, gifts and payroll deferrals, must be done by December 31.

Should I defer income to next year?

Deferring income only helps if you expect a lower tax rate next year or want to push the tax bill later. Consider the effect of other items such as ACA subsidies or phase-outs, and note that employers set the rules on bonus timing.

Year-End Tax Planning Checklist for 2026: What to Do Before December 31

Most of the tax you will owe for 2026 is already decided by the income you have earned. What is left is timing and choices: when to sell an investment, whether to make a gift now or in January, how much to put into a retirement account. Those decisions have deadlines, and many of them end on December 31. This checklist walks through the moves that are worth considering, what each one can and cannot do, and which items can wait until the filing deadline in April 2027. It is general information, not advice for your situation, and every number below links to an IRS source at the bottom of the page.

Step 1: Estimate where you will land

Before you do anything, estimate your 2026 taxable income. Start with your latest pay stub and add up year-to-date wages, then add any bonus, investment income, self-employment profit and retirement withdrawals you expect. Subtract the standard deduction ($16,100 for single filers, $24,150 for heads of household and $32,200 for married couples filing jointly in 2026) or your itemized deductions if they are higher. The result is your taxable income, and the table in the bracket room calculator shows your marginal rate, the rate that applies to your next dollar. Almost every move on this list is worth more or less depending on that rate. A $5,000 pre-tax contribution saves $1,100 at 22% and $1,750 at 35%.

Step 2: Retirement accounts

Workplace plan deferrals. The 2026 limit for employee deferrals to a 401(k), 403(b) and most 457 plans is $24,500, with a $8,000 catch-up for age 50 and over and $11,250 for ages 60 to 63. Payroll deferrals must come out of paychecks dated by December 31, so ask HR or payroll now if you want to raise your percentage for the last pay periods.
IRAs. You can contribute up to $7,500 ($8,600 if 50 or older) for 2026, and you have until the April 2027 filing deadline. The deductibility of a traditional IRA contribution phases out if you or your spouse are covered by a workplace plan, so check the income limits.
Employer match. If your plan matches contributions, confirm you have deferred enough over the year to receive the full match, because some plans calculate it per paycheck.

The guide to retirement contributions before year-end explains the limits and phase-outs in detail.

Step 3: Review your investments

Check your taxable brokerage accounts for realized gains and losses so far this year. If you have losses, you may want to realize them to offset gains; if you have gains and your income is low, you may want to realize more at the 0% rate. Be aware of the wash-sale rule, which disallows a loss if you rebuy the same security within 30 days, and remember that mutual funds often distribute capital gains in December, which are taxable even if you reinvest them. Use the capital gains calculator and the loss harvesting calculator to size the effect. The deadlines here are real: a trade has to be executed in 2026, and waiting for the final trading day leaves no room for error if a market is closed or an order does not fill.

Step 4: Charitable giving

For 2026, itemizers deduct charitable gifts only above 0.5% of adjusted gross income, and people who take the standard deduction can deduct up to $1,000 of cash gifts ($2,000 married filing jointly). Gifts must be made by December 31; a check mailed in December counts if it is postmarked and delivered in the normal course, and a credit card charge counts on the date charged. If you are 70½ or older and have an IRA, consider a qualified charitable distribution, which can satisfy your required minimum distribution without adding to your income. See the charitable giving guide.

Step 5: Required minimum distributions

If you are old enough to have an RMD (73 if you were born from 1951 to 1959, 75 if you were born in 1960 or later), the deadline is December 31 for each year after your first. The penalty for missing it is 25% of the amount you should have withdrawn. Use the RMD calculator and make sure the money actually leaves the account before the last business days of the year; custodians can be slow at year-end.

Step 6: Health accounts

Flexible spending accounts have a use-it-or-lose-it rule: unspent money is forfeited unless your plan allows a carryover (up to $680 for 2026) or a grace period. Check your balance and the claim deadline. For a health savings account, the 2026 limits are $4,400 for self-only coverage and $8,750 for family coverage, plus $1,000 if you are 55 or older, and you can contribute until the April 2027 filing deadline. The HSA and FSA deadline guide has the details.

Step 7: Itemizing, bunching and timing

Compare your expected itemized deductions with the standard deduction using the deduction calculator. If you are near the line, bunching deductible expenses into one year, such as charitable gifts, can help. Paying a bill earlier only helps if the expense is deductible and you would not be limited by the cap on state and local taxes ($40,400 in 2026).

Step 8: Consider a Roth conversion

If your income this year is lower than usual, converting some traditional IRA money to a Roth IRA before December 31 can lock in a low rate. A conversion is taxable income for the year in which it occurs, and you cannot reverse it. The Roth conversion guide explains how to decide.

Step 9: Check withholding and estimated tax

If you suspect you will owe, you can still increase withholding at work for the last paychecks of the year; withholding is treated as paid evenly through the year, even if you increase it late, which makes it more forgiving than estimated payments. If you have self-employment income, the final federal estimated payment for 2026 is due in January 2027. The IRS safe-harbor rules generally avoid an underpayment penalty if you pay at least 90% of this year’s tax or 100% of last year’s (110% if your prior-year AGI was above $150,000).

What can wait until April

IRA and HSA contributions for 2026.
Self-employed retirement plan contributions (SEP-IRA) up to the filing deadline, including extensions.
Gathering documents, brokerage 1099s and mortgage statements.

Keep records and know your limits

Write down what you did and why. A short note listing each year-end move, its date and the confirmation number is enough, and it makes your return easier to prepare. Remember that this list cannot replace advice from a tax professional who knows your whole situation, including state taxes and the alternative minimum tax. If your finances are complicated, ask early: advisers are busy in December and many moves cannot be done at the last minute.

Year-End Tax Planning Checklist for 2026