As the year draws to a close, now is the time to take a pause, and make sure you’re not leaving meaningful tax savings on the table. A few well-timed moves before December 31 can strengthen your retirement readiness, reduce your tax bill, and ensure you’re meeting important IRS requirements.
- 401(k) Contributions: Review your 401(k) contributions and decide if you wish to make additional contributions. The 2025 contribution limit is $23,500 with additional catch-up contributions allowed based on your age. If you are 50-59 years old or 64+ years old, you can qualify for an additional $7,500 contribution. If you are 60-63 years old, you can get up to $11,250 as a catch-up contribution. You should contribute at least enough to take full advantage of your employer’s 401(k) matching contribution.
- Required Minimum Distributions (RMDs) for IRAs: At age 73, you must start taking a minimum distribution from your IRA. Make sure you contact your retirement plan advisor to keep track of this to avoid penalties from the IRS.
- Gifting: If you are giving gifts this holiday season, keep in mind the potential tax consequences. The 2025 annual gift exclusion is $19,000 per gift recipient, which means that you can gift up to that amount per person without having to report on a gift tax return. Married couples can double their annual exclusion to $38,000 per recipient through gift splitting.
- Charitable Contributions: If you are planning on giving donations, you may want to consider maximizing them before the end of this year. 2026 will see some limitations on the deduction that were put in place under the One Big Beautiful Bill Act (OBBBA), but 2025 contributions are not subject to these limitations.
- Stock Portfolio: When reviewing your investments, you should take a look to see if you have any stocks held in a loss position. Since capital gains and capital losses are combined when calculating taxable income, realizing more losses can offset capital gains that have already been realized. You can deduct an overall capital loss up to $3,000 against other types of income.
If you have any questions or need further assistance with tax planning, you can contact your WG tax advisor. We’d be more than happy to help you.
The information provided in this alert is for informational purposes only and is based on current tax laws and regulations at the time of publication. It should not be construed as legal, tax, or financial advice. While we strive to ensure accuracy, tax laws are subject to change, and individual circumstances may vary. Please consult with your legal or WG tax advisor before making any decisions based on the information provided. WilkinGuttenplan is not responsible for any errors or omissions, nor for any actions taken based on this content.
