October is here. As the year draws to a close, it’s crucial to review your tax situation and take advantage of any tax and estate planning strategies that may apply to your situation.
Looking for options that could help you minimize your tax burden and maximize your wealth over the long term? Here are 10 year-end tax planning strategies to consider.
1. Diversify Your Tax Exposure
Consider spreading your investments across different types of accounts: pre-tax (like traditional IRAs), after-tax (like regular brokerage accounts), and Roth accounts. This diversity gives you more control over your tax situation in retirement and can help reduce your lifetime tax burden.
2. Boost Retirement Contributions
In 2026, you can contribute up to $24,500 in employee salary deferrals to your 401(k), $72,000 total when including employer contributions. If you’re age 50 or older, you’re eligible for a catch-up contribution and can contribute up to an additional $8,000 in 2026. However, if you’re between ages 60 and 63 and your plan allows, you can contribute up to $11,250 as a super catch-up contribution instead of the standard $8,000. Consider maximizing these tax-advantaged opportunities, potentially including both traditional and Roth options based on your situation.
3. Plan Your Retirement Distributions
Retirement withdrawals aren’t just about how much you take. The order and timing of your retirement account withdrawals can meaningfully shape your tax bill. Working with your advisor to build a coordinated strategy can help. This may include coordinating between different account types, timing your Social Security benefits, and planning Roth conversions to minimize your tax burden throughout retirement.
4. Consider Roth Conversions
Now might be a good time to convert some of your traditional retirement accounts to Roth accounts. While you’ll pay taxes on the conversion now, future withdrawals will be tax-free, potentially saving you money in the long run. Just keep in mind that a conversion raises your income for the year, which under the OBBBA could push you out of certain deductions (like the SALT cap or the new senior deduction), so it’s worth modeling with your advisor before you convert.
5. Strategic Investment Selling
Your advisor can help you strategically sell investments to minimize taxes. For married couples filing jointly in 2026, you may qualify for a 0% long-term capital gains rate if your taxable income is below $98,900. This creates opportunities to realize gains at lower tax rates, and potentially chip away at large, concentrated stock positions.
6. Optimize Asset Location
Where you hold an investment matters as much as what you hold. A smart asset location strategy places aggressive, growth-oriented investments in your Roth accounts (so future gains are never taxed) and income-producing assets like bonds in pre-tax accounts (where that income is taxed later, not now). Structured well, this can meaningfully reduce your tax drag over time.
7. Maximize Employee Benefits
During your company’s open enrollment period, review all available benefits. Many employers now offer both traditional and Roth 401(k) options, and some even allow for automatic daily conversion of after-tax contributions to Roth accounts. If you’re a high earner, investigate whether your employer offers deferred compensation plans, which could help manage your tax burden today while providing you with an income stream in the years immediately following your retirement.
8. Take Advantage of Health Savings Accounts
If you have a high-deductible health plan, an HSA offers a triple tax advantage: tax-deductible contributions, tax-free growth, and tax-free withdrawals for qualified medical expenses. In 2026, you can contribute up to $4,400 for individual coverage or $8,750 for family coverage. If you’re 55 or older and not enrolled in Medicare, you can contribute an addition $1,000 in catch-up contributions.
9. Consider Additional Charitable Giving
The OBBBA introduced an above-the-line deduction of up to $1,000 for single filers and $2,000 for married couples filing jointly, for direct cash gifts to qualified charities beginning in 2026. This is a meaningful new benefit for the roughly 90% of taxpayers who don’t itemize.
That said, cash isn’t always the most tax-efficient way to give. For donors who do itemize, gifting shares of long-term appreciated stock directly to a charity is often a stronger strategy. The donor can deduct the fair market value of the shares while avoiding the capital gains tax that a sale would have triggered. Just note that charitable deductions for long-term appreciated stock donated to public charities are capped at 30% of adjusted gross income (AGI). This stock-gifting benefit runs through itemized deductions, not the new above-the-line provision, which applies only to cash.
Itemizers, meanwhile, face two new constraints. Total charitable gifts must exceed 0.5% of AGI before any of it counts toward a deduction, and the tax value of itemized deductions overall (charitable giving included) is now capped at a 35% rate (even for donors in the 37% marginal bracket).
Finally, if you are age 70½ or older and charitably inclined, consider making qualified charitable distributions (QCDs) of up to $111,000 in 2026 straight from your IRA to a qualified charity. The gift counts toward your RMD but is excluded from taxable income entirely, making it one of the most tax-efficient ways to give. Just make sure to take your QCD before the rest of your RMD is taken for the year. The IRS treats the first dollars distributed as counting toward the RMD, so a QCD taken after you’ve already satisfied the RMD won’t offset any of that taxable income.
10. Explore Estate Planning Strategies
Beginning in 2026, the federal estate and gift tax exemption is approximately $15 million per individual or $30 million for a married couple filing jointly. While this remains historically generous, it is not guaranteed to last, and the cost of waiting can be significant for families approaching the exemption.
If you are nearing the lifetime limit, consider transferring assets with the greatest appreciation potential out of the estate. Gifting earlier removes future growth from the taxable estate and reduces exposure to possible future exemption reductions.
Annual exclusion gifts of $19,000 per recipient remain a simple but effective tool, particularly when paired with tuition and medical payments made directly to providers.
The following advanced strategies can further enhance flexibility and tax efficiency when used thoughtfully.
- Qualified personal residence trusts (QPRTs) for transferring your home to beneficiaries.
- Spousal lifetime access trusts (SLATs) for transferring assets while maintaining indirect access through your spouse.
- Charitable remainder trusts for balancing charitable goals with income needs.
- Grantor retained annuity trusts (GRATs) for transferring appreciation on assets to beneficiaries.
These strategies are especially relevant for those with concentrated positions, closely held businesses, or rapidly appreciating assets.
Next Steps
While tax planning can be complex, implementing the right strategies can significantly impact your long-term financial success.
If one or more of these strategies seem to be beneficial for you, I encourage you to reach out to your financial advisor to discuss it further. Together, you can evaluate which of these strategies might be most beneficial for your specific situation. If you aren’t currently working with an advisor, connect with us to find the support and insights you’re looking for.
Debra Taylor is not registered with Cetera Wealth Services LLC, Member FINRA/SIPC. Any information provided by this individual is provided entirely on behalf of CWM, LLC and is in no way related to Cetera Wealth Services or its registered representatives.
Converting from a traditional IRA to a Roth IRA is a taxable event.
This article is not intended to provide specific legal, tax, or other professional advice. For a comprehensive review of your personal situation, always consult with a tax or legal advisor.
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