Your Year-End Financial Checklist: Wrap Up Before 2026

By Ted Stricker, CFP®

As the year rapidly winds down, it may seem easier and more convenient to put financial planning off until January. But before you shift into full holiday mode, taking a little time to review your financial and tax situation may yield some significant differences and savings. There are many smart year-end moves you can make right now to strengthen your financial plan and start 2026 with confidence.

At Bernath + Rosenberg, we recommend keeping a sharp eye on year-end financial planning. Here’s a checklist of our top recommendations to help you make the most of your opportunities before December 31. Even a few proactive steps now can help you feel more organized and ready for the year ahead.

Assets & Liabilities

• Review your capital losses: In taxable investment accounts, consider realizing losses to offset capital gains by 12/31. Any losses beyond your capital gain amount can be used to reduce ordinary income by up to $3,000. Should you have more than $3,000 in capital losses, record them and carry them over for use in future years.
• Review any year-end capital gain distributions: If you own shares of a mutual fund or ETF, you will likely have end-of-year capital gain distributions. Capital distributions this year may be much higher than expected.
  
• Review RMDs (required minimum distributions): If you are age 73 or older, or taking an RMD from an inherited IRA, here are some important points to keep in mind:
  
  • RMDs from multiple traditional IRAs can generally be aggregated together.
  • RMDs from inherited IRAs cannot be aggregated with traditional IRAs.
  • RMDs from employer retirement plans generally must be calculated and taken separately, with no aggregation allowed, except for 403(b) plans.
  • If you were born in 1951–1959, you must begin taking RMDs at age 73. If you’ve turned 73 in 2025, you have until April 1 of 2026 to take your first RMD, but you must also take your 2026 RMD before 12/31/26 as well. Every year after that, you must take your RMD by December 31.
  • Failure to take your normal RMD by 12/31 (except your first one) may result in a 25% tax penalty on the amount not taken.
    

Tax Planning

• Do you expect your income to increase in the future? If so, there are several strategies that can help minimize your future tax liability, including:
  • Contributing to a Roth IRA or Roth 401(k)
  • Utilizing Roth conversions
  • If offered by your employer plan, consider making after-tax 401(k) contributions.
  • If you are over 50 years old and earn more than $145,000 (indexed in the future) in 2025, any catch-up contributions to an employer-sponsored retirement plan (e.g., 401(k)) will need to be made “after tax” with no tax deduction (i.e., a Roth contribution). If your company plan does not have a Roth component, you will not be able to make catch-up contributions to the plan. Consider your tax planning with your employer plan contributions for 2025.
• Keep your tax bracket in mind: If you are on the threshold of two tax brackets, you’ll want to defer income or accelerate deductions in order to keep your income in the lower bracket. Keep the following important thresholds in mind:
  • As an example of “bracket creep,” for the 2025 tax year, the 24% marginal federal income tax rate applies to taxable income over $103,350 (single) and $206,700 (married filing jointly), up to $197,300 and $394,600, respectively. Income above those limits enters the 32% bracket (i.e., over $197,300 for single and $394,600 for married filing jointly).
  • If you haven’t maxed out your 401(k) for 2025, consider sending 100% of your final paychecks to your company retirement plan up to the maximum to avoid jumping into a new, higher tax bracket. 
  • For taxable income above $533,400 single ($600,050 married filing jointly), any long-term capital gains will be taxed at the higher 20% rate.
  • If your modified adjusted gross income (MAGI) is over $200,000 single ($250,000 married filing jointly), you may be subject to the 3.8% Net Investment Income Tax on the lesser of net investment income or the excess of MAGI over $200,000 single ($250,000 married filing jointly). 
  • If you are on Medicare, consider the impact of IRMAA surcharges by referencing the new 2025 rates.
• Donate to charity: There are several ways to fulfill your philanthropy and faith-based charitable giving initiatives, as well as reduce your current-year tax bill. Consider tax-efficient strategies, such as:
  • Gifting appreciated securities
  • Making a qualified charitable distribution (QCD)
  • Bunching your charitable contributions or contributing to a donor-advised fund every few years to allow itemization in specific years
  • Bunching contributions into a donor-advised fund and completing a large Roth conversion in the same year may be an excellent strategy to help you save on taxes. 
  • Consider setting up and funding a donor-advised fund sooner rather than later. Investment custodian programs, (such as Schwab Charitable), fill up with requests and may not get to your account and contribution by 12/31.
• Business owner tax considerations: Businesses have several year-end tax considerations, including:
  • Qualified Business Income Deduction: A business that produces pass-through income could be eligible for this deduction.
  • Consider the impact of a Roth vs. traditional retirement account and how it could affect taxable income and qualified business income.
  • Consider deferring or accelerating business expenses as a way to reduce overall tax liability.
  • If you follow the calendar tax year, you may have to open your retirement plan before year-end.

Cash Flow

• Improve savings: If you have extra funds, consider the following ways to save:
  • If you have an HSA, you may be able to contribute $4,300 ($8,550 for a family) and an additional $1,000 if you are over age 55 and not enrolled in Medicare.
  • If you have an employer retirement plan, such as a 401(k), you may be able to save more, but because the rules vary as to when you can make changes, you must consult with the plan provider. The maximum salary deferral contribution to an employer plan is $23,500, plus the catch-up contribution if age 50-59 or over 64 is $7,500 per year. For those 60-63, the super catch-up is $11,250.
• Consider a 529 plan: If you have children who plan to attend college, a 529 plan is a great way to save. You can use your annual exclusion amount to contribute up to $19,000 per year to a beneficiary’s 529 account, gift tax-free. Alternatively, you can make a lump-sum contribution of up to $95,000 to a beneficiary’s 529 account, and elect to treat it as if it were made evenly over a five-year period, gift tax-free. Depending on your state, you may be eligible for a state tax deduction as well. 

Estate Planning

• Review major life events: Have there been any changes to your family (birth, marriage, divorce, or death), or have you bought/sold any assets this year? If so, it’s important to review your estate plan to ensure your beneficiaries and inheritance instructions still align with your wishes.
• Lifetime gifting: Are there any gifts you still want to make this year? If so, you can make up to $19,000 in gifts per person per year without incurring gift taxes.

If You Have Questions, Let’s Have a Discussion!

Choosing and implementing year-end financial and tax strategies can be confusing, but our team is here to help! By coordinating your tax planning with your overall financial planning on long-term goals, our assistance could be beneficial to your financial future. With our Certified Public Accountants and CERTIFIED FINANCIAL PLANNER® professionals, Bernath + Rosenberg stays current with the latest in tax laws and planning strategies to help you pursue a rewarding and comfortable retirement, according to your unique and special objectives.

To get started and make the most of your hard work, schedule a meeting by calling (212) 221-1140 or email tstricker@brwealth.com.

About Ted

Ted Stricker is a partner and financial advisor at Bernath + Rosenberg, a full-service accounting, tax, and wealth management firm with offices in Monsey, NY, Lakewood, NJ, Cedarhurst, NY, and Miami Beach, FL. The firm demonstrates a personalized approach to custom-tailored solutions and an unwavering commitment to client service. With over 26 years of experience in the financial services industry, Ted manages the firm’s wealth management team, and specializes in designing financial plans for business owners and affluent families. Since joining the team in 2015, he provides practical and sound advice, combining innovative approaches and solutions that reflect clients’ personality, lifestyle, and goals.

For the ninth year in a row, Bernath + Rosenberg has been named as one of the leading CPA firms in financial planning by Accounting Today, a publication that receives hundreds of submissions each year and features the Top 150 Firms in the nation. Ted is a CERTIFIED FINANCIAL PLANNER® practitioner and is a member of the Financial Planning Association. To learn more about Ted, connect with him on LinkedIn.

Professionals associated with Bernath & Rosenberg P.C. may be either (1) registered representatives with, and securities and advisory services offered through LPL Financial, Member FINRA/SIPC, a registered investment advisor; or (2) solely tax professionals of Bernath & Rosenberg P.C., and not affiliated with LPL Financial. Tax/accounting/CPA-related services offered through Bernath & Rosenberg P.C. is a separate legal entity and not affiliated with LPL Financial. LPL Financial does not offer tax advice or tax/accounting/CPA-related services. 

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