By Erik Smith, CFP®
Autumn has a way of sneaking up on your finances. The holidays arrive, the calendar fills, and the window to make meaningful tax moves for the year quietly closes on December 31. After that date, most of these opportunities are gone until next year.
Right now, that window is still open. A handful of tax planning moves made before December 31 can lower what you owe, put your accounts in better shape, and spare you an unwelcome surprise at filing time. Here are the ones worth a look while there is still time to act.
Fill the Accounts That Still Have Room
One of the simplest year-end moves is also one of the most overlooked. If you have not fully funded your retirement accounts for the year, there may still be time.
Contributions to a workplace plan such as a 401(k) generally need to come out of your paycheck by December 31, so if you have room left and the cash flow to use it, the final pay periods of the year are your last chance. IRAs work a little differently, since contributions for the year can generally be made up to the tax filing deadline next spring.
Contribution limits change from year to year, and several increased for 2026. Rather than work from memory, check the current figures before you act, and confirm with your payroll department how much time is left to adjust your elections.
Review Your Withholding While You Still Can
This is the move that quietly saves people from an unpleasant April.
If your income changed this year, whether you exercised equity compensation, sold an investment, took a large distribution, or received a bonus, the amount withheld for taxes may not match what you will actually owe. The last paychecks of the year are your final opportunity to adjust withholding, and an estimated payment can help close the gap as well.
Checking this now is far easier than discovering the shortfall when you file, and it can help you avoid underpayment penalties.
Consider Harvesting Losses
In any year with market movement, some investments in a taxable account may be worth less than you paid for them. Selling those positions to realize the loss, a strategy known as tax loss harvesting, can offset gains elsewhere in your portfolio and, within limits, a portion of your ordinary income.
It is a genuinely useful tool, but the details matter. Rules restrict buying back the same or a substantially identical investment too soon, and a loss harvested carelessly can create problems rather than solve them. Sales need to happen by December 31 to count for this year, but this is one to handle deliberately rather than in the final days of December.
Look at a Roth Conversion
A Roth conversion moves money from a traditional retirement account into a Roth. You pay tax on the converted amount now in exchange for tax-free growth and withdrawals later, as long as the rules are met. In the right year, it can be a powerful move.
The years that tend to make sense are ones where your income is lower than usual, perhaps after a career change or in the early years of retirement before required distributions begin. Converting in a lower-income year can mean paying tax at a lower rate than you might face later. A conversion generally must be completed by December 31 to count for this tax year, and the added income can ripple into other areas, such as Medicare premiums down the road. Whether it fits depends on your full picture, which is exactly why it is worth modeling before year-end rather than assuming.
Make Your Charitable Giving Count
If you give to causes you care about, the end of the year is the moment to be intentional about it. Giving appreciated investments instead of cash, using a donor-advised fund, or bunching several years of gifts into one can all stretch your generosity further.
There is also a change worth knowing about this year. Beginning in 2026, recent tax law allows a modest deduction for cash gifts to qualifying charities even if you take the standard deduction, so more people may see a tax benefit from giving than in recent years. The rules for those who itemize shifted as well, which can affect how larger gifts are timed. The details are specific, so confirm how they apply to you before you write the check.
Know What Changed This Year
This is the part that catches people off guard. Tax law does not sit still, and recent legislation changed several things that affect year-end planning, including a larger standard deduction and a significantly higher cap on the state and local tax deduction for many households.
These changes matter because they can flip the math on decisions like whether to itemize or take the standard deduction, which in turn affects how and when you give. Planning off last year’s assumptions is how good intentions turn into missed opportunities. For a broader list of items to review, our end-of-year checklist is a helpful companion.
The Thread That Ties It Together
None of these moves happens in a vacuum. A Roth conversion affects your bracket, which affects whether itemizing makes sense, which affects your charitable strategy, which affects your withholding. Pull one lever and the others shift.
That is why year-end planning works best as one coordinated conversation rather than a series of decisions made in a hurry. At Wealth Dimensions, we map these moves together and coordinate directly with your CPA so your tax plan and your financial plan reflect the same set of facts. For a look at what your accountant would like to see from you before the year closes, read our companion piece, What Your CPA Wishes You Would Do Before the Year Closes.
If you have not reviewed your year-end position yet, there is still time, though not much. To talk it through before the window closes, call (513) 554-6000 or visit wealthdimensions.com.
Frequently Asked Questions
Which year-end tax moves have a December 31 deadline?
Several of the most common ones do, including employee contributions to a workplace retirement plan, Roth conversions, selling investments to realize losses, and charitable gifts you want to count for this year. Some items, such as IRA contributions, can generally be made up to the filing deadline next spring. At Wealth Dimensions, we help clients sort out which moves are time-sensitive so nothing important slips past the deadline.
Is a Roth conversion a good idea this year?
It can be, particularly in a year when your income is lower than usual, but the answer depends on your current and expected future tax rates, how you would pay the tax, and how the added income affects other parts of your plan. The Wealth Dimensions team models conversion scenarios alongside your CPA so the decision is based on your actual numbers.
How did recent tax law changes affect year-end planning?
Recent legislation increased the standard deduction, raised the cap on the state and local tax deduction for many households, and added a modest charitable deduction for people who do not itemize. These changes can shift whether itemizing makes sense and how charitable gifts are best timed. Wealth Dimensions works with clients and their CPAs to apply the current rules to each household’s situation.
About the Author
Erik Smith, CFP® is a dedicated Financial Advisor at our firm, specializing in creating personalized financial plans that meet the unique needs of our clients. With a keen focus on portfolio construction, research, and analysis, Erik plays a crucial role in monitoring and adjusting our clients’ financial strategies to ensure they align with their long-term goals.
Prior to joining Wealth Dimensions, Erik worked at UBS Financial Services for six years, developing and executing strategic financial plans to help the firm’s high-net-worth clients achieve their long-term goals.
Erik graduated from Xavier University with both a Bachelor of Science in Business Administration (BSBA), majoring in finance, and an MBA with concentration in finance. He also earned a CERTIFIED FINANCIAL PLANNERTM certification.
Erik is the president of the Habitat for Humanity of Greater Cincinnati Young Professionals. When he’s not involved in the community, he enjoys spending his free time attending concerts and golfing.
Disclosure
Not an offer of tax advice. For informational and illustrative purposes only.
For informational purposes only. Not intended as investment advice or a recommendation of any particular security or strategy. Information prepared from third-party sources is believed to be reliable though its accuracy is not guaranteed. Opinions expressed in this commentary reflect subjective judgments of the author based on conditions at the time of writing and are subject to change without notice. For more information about Wealth Dimensions, including our Form ADV Part 2A Brochure, please visit https://adviserinfo.sec.gov or contact us at 513-554-6000. Please be advised that this material is not intended as legal or tax advice. Accordingly, any tax information provided in this material is not intended and cannot be used by any taxpayer for the purpose of avoiding penalties that may be imposed on the taxpayer.