The Year-End Tax Planning Guide Every Individual Should Read

December 31 does more than end the year. It can also close the door on tax-planning opportunities you may not get back.

Some decisions need to happen before year-end to affect your 2026 tax picture. That doesn't mean making financial moves simply to save taxes.

It means knowing what options you still have while you still have time to consider them.

LMJ's Individual Year-End Tax Checklist covers deductions, credits, retirement contributions, investments, family-related tax issues, and other items worth reviewing before December 31.

Download the Individual Year-End Tax Checklist to help you identify the items worth reviewing before December 31.

Start With Questions

Year-end planning starts with what changed, not with a generic list of tax deductions. Changes like these can affect much more than your April tax return. They may influence withholding, deductions, investment decisions, retirement planning, charitable giving, and estate strategies.

• What changed financially for you in 2026?
• Did your income increase?
• Receive a large bonus?
• Sell investments?
• Buy or sell real estate?
• Retire?
• Make significant charitable gifts?
• Have a child or another change in your family?
• Receive business or partnership income?
• Start thinking seriously about transferring wealth to the next generation?

Five Conversations Worth Having Before Year-End

You don't need to work through every tax provision yourself. Start with the financial decisions that could still be open.

1. Are You Headed for a Tax Surprise?

Last year's withholding or estimated payments may no longer fit this year's income.

A bonus, investment gain, business income, or other income change could alter your tax picture. So can new deductions.

A current tax projection can help determine whether your withholding is on track or an estimated payment deserves consideration before year-end. Don't wait until tax season to learn what you could have addressed in December.

2. Have You Maximized the Tax-Advantaged Accounts That Make Sense for You?

Year-end is a good time to check your retirement and HSA contributions.

For 2026, the employee contribution limit for many 401(k), 403(b), and governmental 457 plans is $24,500. Additional catch-up contributions may be available depending on age.

HSA contribution limits have also increased for 2026. But maximizing a contribution isn't automatically the right decision. The better question is: How do your retirement, tax, cash flow, and longer-term financial goals fit together?

3. Could Your Investment Portfolio Use a Tax Review?

Your investment decisions shouldn't be driven by taxes alone. But you shouldn't ignore taxes either.

If you realized significant capital gains during 2026, review your taxable investment accounts for gains and losses before year-end. Capital losses can offset capital gains, and remaining net losses may offset a limited amount of ordinary income, with unused losses generally carried forward.

This may also be a good time to discuss whether a Roth conversion fits your longer-term plan.

A conversion generally creates taxable income today in exchange for potentially tax-free qualified withdrawals later. That makes modeling the tax impact before converting especially important.

4. Are You Giving Money Away in the Most Tax-Efficient Way?

If charitable giving is already part of your plan, how you give can matter.

Cash, appreciated securities, donor-advised funds, and qualified charitable distributions can have different tax consequences and documentation requirements.

The same idea applies to gifts made to family members.

For 2026, the annual federal gift tax exclusion remains $19,000 per recipient, while the federal estate and gift tax basic exclusion amount is $15 million per individual.

If significant wealth transfer is part of your plans, year-end is a good time to bring your tax, estate, and financial advisors into the same conversation.

5. What Else Changed in Your Life?

Sometimes the most important tax question has nothing to do with a new tax law. It's: "What happened this year?"

Marriage, divorce, a new child, retirement, a major vehicle purchase, changes in health coverage, education expenses, a move, or changes in where you live and work can all create issues worth reviewing.

The 2026 rules also include provisions affecting child and dependent care, certain car-loan interest, qualified overtime and tips, and additional deductions for some taxpayers age 65 and older.

You don't have to know which rules apply. You do need to tell your tax advisor what changed.

Don't Forget the State Tax Picture

This can be especially important for individuals with income, property, or business interests across multiple states.

Federal and state tax treatment don't always match.

For 2026, the federal SALT deduction limit is $40,400, or $20,200 for married taxpayers filing separately, with the deduction beginning to decrease above specified income thresholds.

Your year-end tax projection should consider state taxes alongside your federal situation rather than assuming the results will be the same.

Tax Planning Should Support Your Bigger Financial Plan

The goal isn't simply to find another deduction before December 31.

It's to understand how the decisions you're making today affect your taxes, investments, retirement, family, estate, and future financial goals.

So instead of asking only: "How can I lower my 2026 taxes?" Consider asking: "What financial decisions should I make before 2026 ends?"

That opens a much more useful conversation.

Frequently Asked Questions

Your Year-End Review Doesn't Need to Start from Scratch

LMJ's Individual Year-End Tax Checklist can help you identify the areas worth reviewing, from retirement contributions and charitable giving to investments, estate planning, withholding, deductions, and credits.

Download the Individual Year-End Tax Checklist, mark the items that apply to you, and use it to start your year-end tax planning conversation.

Because the best time to learn you had an option isn't after it's gone.