With approximately 100 days remaining in 2026, this is a timely opportunity to assess your tax position before filing season begins. Decisions made during the final months of the year can affect your tax result, support cash-flow planning, and reduce the chance of an unwelcome surprise when you prepare your return.
It is easy to postpone tax considerations until documents begin arriving during filing season. However, reviewing your circumstances before December 31 can be especially helpful if your income changed, you earned money outside a traditional job, increased retirement savings, or experienced an important life event.
Year-end tax planning does not need to be overwhelming. Focusing on a few relevant areas now can provide a clearer view of your 2026 tax picture and reveal steps that may be beneficial before the calendar year ends.
Check Tax Withholding and Estimated Tax Payments
A key part of 2026 year-end tax planning is confirming that your tax withholding and estimated payments are appropriate for your current situation. Amounts that were suitable earlier in the year may no longer match your income or tax obligations.
A job change, additional earnings, investment transactions, side-business activity, or significant personal changes can all affect the amount of tax you may owe. When withholding or estimated payments do not keep pace with these changes, an unexpected balance may be due at filing time.
Reviewing these figures before year-end gives you time to identify whether an adjustment may be needed. Taking action now may help make tax season more predictable.
Review Side Income and 1099 Reporting
Income outside traditional employment continues to be common, including freelance projects, consulting work, online sales, rideshare services, and payments received through digital platforms. If you earned this type of income in 2026, it is worthwhile to review your records before the year closes.
Organizing income, expenses, and potential tax obligations can help you understand your responsibilities and stay prepared for 1099 reporting. It can also make the filing process less difficult when tax documents begin to arrive.
Looking closely at self-employment activity may also help identify eligible business deductions. A timely review can reduce the risk of overlooked information or avoidable complications during tax preparation.
Consider Increasing Retirement Contributions
Retirement contributions can support long-term savings goals while also playing a role in managing current-year taxes. Before year-end, consider whether you have room to increase contributions to eligible retirement accounts.
Additional contributions may reduce taxable income while allowing you to build more savings for the future. Taxpayers age 50 and older may have access to catch-up contribution opportunities, which can provide additional tax-advantaged savings before the year ends.
Recent law changes also expanded certain contribution options for some people in their early 60s. For individuals nearing retirement, this makes a year-end retirement savings review particularly important.
Assess Whether a Roth IRA Conversion Fits Your Plan
The end of the year can also be a useful time to consider whether a Roth IRA conversion supports your financial objectives. A conversion from a traditional IRA to a Roth IRA generally creates taxable income in the year the conversion occurs.
In return, qualified future withdrawals from the Roth account may be tax-free. This tradeoff may be meaningful for people who are considering their future retirement income and distribution plans.
A Roth conversion may be worth reviewing for those in a lower-income year or for individuals planning ahead for future retirement distributions. Evaluating the possible long-term effects before year-end can help determine whether this strategy aligns with your circumstances.
Review Education and Dependent Care Tax Benefits
Families with children or students in college should review available tax benefits before the year concludes. Education and dependent care expenses may create planning opportunities, depending on each taxpayer’s overall circumstances.
If you or a dependent attends college, paying certain qualified education expenses before year-end may help maximize available education-related tax credits. Keeping clear records of those expenses is an important part of the process.
Taxpayers who paid for daycare, after-school care, summer day camps, or other qualifying care so they could work or seek employment should also review their dependent care information. Recent tax law changes expanded the Child and Dependent Care Credit beginning in 2026, making this an important area to revisit before filing season.
Make the Most of HSA and FSA Tax Advantages
Health Savings Accounts and Flexible Spending Accounts can offer valuable tax benefits, yet they are often overlooked until the final weeks of the year. A review of these accounts can help ensure you are aware of the opportunities still available.
Before December 31, check applicable contribution limits, current account balances, and qualifying expenses. Depending on your situation, there may still be time to use available HSA or FSA tax benefits.
A brief year-end review can help you use these tax-favored accounts more effectively. It also provides a chance to confirm that your records are complete for tax preparation.
Evaluate Charitable Giving Options
Charitable donations remain an important item for many taxpayers to consider during year-end planning. Reviewing your giving before the calendar year closes can help you understand the potential tax impact of planned contributions.
Under the One Big Beautiful Bill Act, taxpayers claiming the standard deduction may still qualify to deduct certain cash charitable contributions beginning with the 2026 tax year. That means charitable gifts may be worth evaluating even for people who do not anticipate itemizing deductions.
Taxpayers close to the threshold for itemizing may also want to consider whether combining charitable gifts into one tax year could improve the overall tax benefit of their giving approach. Reviewing this possibility before making contributions may be helpful.
Confirm RMDs and Beneficiary Designations
Retirement tax planning is not limited to making contributions. Taxpayers age 73 or older generally must take required minimum distributions, or RMDs, from certain retirement accounts each year.
Not withdrawing the required amount can result in penalties. Reviewing account balances and distribution requirements before year-end can help ensure this responsibility is addressed on time.
This is also an appropriate time to update beneficiary designations for retirement accounts, life insurance policies, and other financial accounts. Marriage, divorce, births, deaths, and other family changes can make previous designations outdated. Keeping this information current helps ensure assets are distributed according to your wishes.
Organize Your Records Before Tax Season
One of the most practical year-end tax planning steps is getting your records in order. Gathering paperwork now can make tax preparation more efficient and less stressful later.
Collect receipts, donation acknowledgments, bank statements, business expense records, and other tax-related documents while the details are still easy to verify. Early organization may also help identify deductions or credits that could otherwise be missed.
As filing season approaches, it can become harder to locate missing paperwork or confirm important details. Spending time on organization now can help simplify the process when it is time to prepare your return.
The remaining months of 2026 may pass quickly, but there is still time to review meaningful year-end tax planning opportunities. A few proactive steps may improve your overall tax picture and reduce stress during the upcoming filing season.
If you would like help reviewing these year-end tax planning strategies or discussing steps that may prepare you for tax season, contact Paul Cox & Todd today. Our team would be glad to help you evaluate your options and create a plan that supports your financial goals.
