Year-End Tax Checklist: 8 Things to Do Before December 31
Shankar Subramanian, CPAYear end is your last chance to lower this year's tax bill. Retirement savings, charity, selling losing investments, and more: your full checklist for 2026.
Most tax moves for 2026 have to be done by December 31, 2026. Go through this list in November so nothing is rushed.
1. Max out your 401(k)
The 2026 limit is $24,500. If you are 50 or older, you can add $8,000 more. If you are 60, 61, 62, or 63, the extra amount is $11,250 instead. Contributions go through payroll, so ask HR now to raise your rate for the last paychecks of the year.
2. Sell investments that lost value
Losses offset gains. If your losses are bigger than your gains, you can deduct up to $3,000 of the extra loss against your other income, and carry the rest forward. Watch the wash sale rule: buying the same investment within 30 days before or after the sale cancels the loss for now.
3. Plan your gifts to charity
Starting in 2026, people who do not itemize can deduct up to $1,000 of cash gifts to charity ($2,000 for married couples filing jointly). If you do itemize, consider "bunching": giving two years of gifts in one year, perhaps through a donor-advised fund, so you clear the standard deduction every other year.
4. Take your required minimum distribution
If you are 73 or older, take your required minimum distribution from your IRAs and old 401(k)s by December 31. Missing it brings a penalty.
5. Think about a Roth conversion
Converting part of a traditional IRA to a Roth IRA means paying tax now so the money grows tax-free later. A lower income year is often the best time. Conversions must happen by December 31 to count for 2026.
6. Business owners: time big purchases
Equipment you buy and start using by December 31 can usually be written off this year. The One Big Beautiful Bill made 100% bonus depreciation permanent for qualifying property acquired after January 19, 2025. Only buy what the business needs. A purchase you do not need is still a cost, even with a deduction.
7. Check your estimated payments
Add up what you have paid in withholding and estimated taxes so far. The last 2026 estimated payment is due January 15, 2027. Catching a shortfall now can save you a penalty.
8. Use your FSA money
Many flexible spending accounts are "use it or lose it." Check your balance and your plan's deadline, then book the eye exam or refill the prescription before the money is gone.
Want a quick year-end review? We go through this list with you on a free 30 minute call.
Sources: IRS news release on 2026 retirement plan limits, IRS Topic 409 (capital gains and losses), and IRS guidance on the One Big Beautiful Bill provisions.
Want help with this?
Book a free 30 minute call with Shankar. We will look at your numbers and make a plan that fits you.
