By Matt D’Amico, CFP®, ChFC®
Few people enjoy doing their taxes. If you’re in the majority, you might prefer to wait until the new year to finalize your tax planning. However, if you want to do all you can to save on your taxes, you’ll need to make some key moves by December 31. These are some of the most common year-end tax strategies we recommend to our clients.
Contribute to Your Workplace Retirement Plan (and HSA)
You have until April 15, 2026, to contribute to an IRA for 2025. But if you have an employer-sponsored retirement plan like a 401(k) or a 403(b), you only have until December 31 to contribute.
If you have a health savings account (HSA), maximizing your contributions is one of the most effective year-end tax strategies. It offers a triple tax advantage:
- Contributions are tax-deductible (if done through payroll).
- Funds in the account grow tax-deferred.
- Withdrawals are tax-free.
You have until April 15 to contribute to your HSA; the individual maximum is $4,300, and the maximum for families is $8,550.
Think About Itemizing Deductions and Charitable Giving
Due to amendments from the One Big Beautiful Bill Act, for 2025, standard deductions are as follows:
- Single/Married Filing Separately: $15,750
- Married Filing Jointly/Surviving Spouses: $31,500
- Head of Household: $23,625
The majority of tax filers take the standard deduction. However, if you anticipate having significant deductions for 2025, itemizing your deductions may prove to be one of the most useful year-end tax strategies.
If you’re close to the cutoff and want to itemize, several year-end tax strategies may help you clear the threshold. One example is “bunching” charitable donations. With this tax planning strategy, you combine multiple years’ worth of charitable gifts into one.
If you want an immediate tax deduction, you might also consider a donor-advised fund (DAF). With a DAF, you get an instant tax deduction when you contribute funds to the account. But you don’t have to decide where the funds go right away; over time, you can recommend that certain amounts be donated to specific charities.
Year-end tax strategies involving charitable giving may not be right for everyone. Although, if philanthropy is important to you, carefully structuring your gifts may lead to tax savings.
Don’t Forget About Tax-Loss Harvesting
If you anticipate owing capital gains taxes this year, you might be able to reduce your tax liability with tax-loss harvesting—one of the most useful year-end tax strategies for investors.
With this strategy, you sell certain investments at a loss to offset the gains you’ve already realized. If your losses exceed your gains, you can deduct up to $3,000 from your taxable income.
Prepare for Tax Changes in 2026
You may already know that major tax changes are coming in 2026. These are some of the upcoming adjustments to be mindful of:
- Tips and overtime pay won’t be taxed.
- Seniors aged 65 and older may deduct an additional $6,000 (subject to income limitations).
- Standard deductions are increasing to $16,100 for individuals and $32,000 for married couples.
- State and Local Tax (SALT) deduction caps are increasing.
- The child tax credit is increasing to $2,200 per child.
Starting in 2026, all catch-up contributions to 401(k)s, 403(b)s, and governmental 457(b) plans will need to go to Roth accounts if you are an employee who earned more than $145,000 in W-2 wages from that employer in the prior year. This applies both for “over 50” catch-up contributions of $7,500 per year and “super catch-up” contributions of $11,250 for those who turn 60, 61, 62, or 63 in that year.
Although these changes may not directly impact your year-end tax strategies for 2025, proactively planning for these changes may help you reduce your 2026 tax bill.
Let Us Help You Choose Year-End Tax Strategies
If you’re looking to lower your tax burden, there’s no shortage of year-end tax strategies to choose from. But unless you’re a tax professional, it can be difficult to determine which ones may best serve your needs.
At Networth Advisors, LLC, our primary focus is to take complicated retirement concerns and help create simple solutions. Our team specializes in income planning and legacy preservation, and we’re dedicated to helping clients like you align their finances with their vision for the future.
If you think we may be the right firm for you, we’d love to help you identify the year-end strategies that can support a more confident financial future. To schedule a meeting, call (800) 822-3639 or email schedule@networthadvisorsllc.com.
About Matt
Matt D’Amico, CFP®, ChFC®, is a registered Investment Adviser Representative and financial advisor at Networth Advisors, LLC, a financial planning and wealth management firm in Canonsburg, PA. The firm is dedicated to helping clients enjoy a successful retirement, specializing in income planning and legacy preservation for pre-retirees and retirees. Matt excels at simplifying complex retirement concerns to help clients make smart financial decisions.
Matt discovered his passion for finance in college, inspired by a trusted mentor, and earned a degree in finance and business management from Saint Vincent College. Before joining Networth Advisors, he gained valuable experience at New York Life and MassMutual, where he obtained his Life, Accident & Health Insurance Licenses. Matt is also a CERTIFIED FINANCIAL PLANNER® professional and Chartered Financial Consultant®.
Outside of work, Matt is a sports junkie and music enthusiast. He enjoys spending time with friends, embarking on adventures with his wife, Kayla, and their mini labradoodle, Nellie. He is also the co-author of Networth for Retirement: Mapping Out Your Journey. To learn more about Matt, connect with him on LinkedIn.
