Tax planning isn’t just about reducing this year’s bill — it’s about creating flexibility and efficiency for the years ahead. By acting before December 31, retirees and investors can:

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  Manage taxable income and deductions strategically.
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  Avoid penalties tied to Required Minimum Distributions (RMDs).
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  Take advantage of time-sensitive opportunities, such as Roth conversions or charitable giving.
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  Position themselves more favorably for potential 2026 tax bracket changes.

A Roth IRA conversion allows you to transfer funds from a traditional IRA into a Roth IRA, paying taxes now in exchange for tax-free growth and withdrawals later (if IRS requirements are met).

Why now?

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  Current income tax rates, set under the TCJA, are historically low — but they're scheduled to revert to higher levels in 2026 unless Congress acts.
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  Completing a conversion in 2025 could mean paying a lower tax rate on converted dollars than you might in future years.

For individuals age 73 or older (or 75 beginning in 2033 under SECURE 2.0), RMDs must be withdrawn from tax-deferred retirement accounts such as IRAs or 401(k)s by December 31 each year.

Missing your RMD deadline can trigger significant penalties — currently 25% of the amount not withdrawn (potentially reduced to 10% if corrected promptly).

Even if you don’t need the funds for spending, RMDs present an opportunity to:

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  Fund QCDs (as mentioned above).
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  Reinvest distributions into a taxable or Roth account.
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  Use proceeds for tax-efficient gifting or portfolio rebalancing.

If you hold investments in taxable accounts, you can use tax-loss harvesting to offset realized capital gains. This strategy involves selling underperforming assets to recognize a capital loss, which can then be offset against current or future capital gains — up to $3,000 of ordinary income annually if the losses exceed the gains.

A few key considerations:

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  The IRS "wash-sale rule" prohibits repurchasing the same (or substantially identical) security within 30 days of the sale.
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  Tax-loss harvesting should align with your long-term investment goals, not just short-term tax outcomes.

Year-end is also a natural time to evaluate your estate and legacy plans. In 2025, the federal estate and gift tax exemption remains historically high at $13.61 million per individual (double for married couples). Still, that amount is scheduled to revert to roughly half in 2026 unless new legislation extends it.

To take advantage of current exemption levels, individuals may consider:

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  Making annual tax-free gifts of up to $18,000 per recipient.
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  Funding 529 plans for children or grandchildren.
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  Reviewing or updating trusts and beneficiary designations.

As mentioned earlier, many TCJA provisions — including lower marginal rates and higher standard deductions — are scheduled to expire after 2025.

That means:

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  Tax brackets may rise.
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  Estate exemptions could be reduced by nearly half.
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  The child tax credit and SALT deduction limits may revert to prior levels.

Now is the time to act. As 2025 draws to a close, minor adjustments can make a significant difference in your long-term financial outlook.

Schedule a consultation with Goldstone Financial Group today to review your retirement income, tax strategy, and year-end opportunities before the calendar — and current tax laws — reset.

Thoughtful planning now means fewer surprises later — and greater peace of mind as you head into 2026.

Learn More: What Year-End Tax Moves Should You Consider? – Ask an Advisor