By Brad Ritter
Between holiday plans, family coming into town, and battling the weather (at least here in Cincinnati!), the last few months of the year fill up quickly, and it’s easy to let December 31 arrive before you’ve looked at a long list of tax, retirement, and benefits opportunities that expire when the calendar flips. 2026 deserves a closer look than usual, since it’s the first tax year in which several provisions of the 2025 tax law, commonly called the One Big Beautiful Bill Act, fully apply, and the first year of a new rule for how higher earners make catch-up contributions. Here are the moves that tend to matter most.
Finish strong on retirement plan contributions
For 2026, you can contribute up to $24,500 to a 401(k), 403(b), or most 457 plans. If you’re 50 or older, you can add a catch-up contribution of $8,000, and if you’re between 60 and 63 and your plan allows it, a “super catch-up” of $11,250 replaces the standard catch-up amount.
Because workplace contributions come out of your paycheck, anything not deferred by your final paycheck is gone for 2026, so if you’re behind, raise your contribution percentage while enough pay periods remain to close the gap. IRAs give you more breathing room. The 2026 IRA limit is $7,500, plus a $1,100 catch-up for those 50 and older, and you have until the April 2027 filing deadline to contribute for 2026.
A new wrinkle for higher earners 50 and older
Starting this year, if you’re 50 or older and earned more than $150,000 in FICA wages from your employer in 2025, your catch-up contributions to that employer’s plan must go in as Roth (after-tax) dollars, and if your plan has no Roth option, you can’t make catch-up contributions at all. Your base $24,500 can still go in pre-tax, but the catch-up no longer lowers this year’s taxable income. Check your pay stubs to confirm your plan is handling it correctly, and build the lost deduction into your tax projection.
Consider a Roth conversion while you can see the whole year
A Roth conversion moves pre-tax retirement money into a Roth account, where you pay income tax now in exchange for tax-free growth and withdrawals later. Conversions must be finished by December 31, and late in the year is often the best time to decide because your income picture is clear. If you retired mid-year, had a lighter business year, or are between retirement and Social Security, converting just enough to fill your current bracket can pay off later.
The tradeoff is that a conversion raises your adjusted gross income (AGI). For those 65 and older, the new $6,000 senior deduction begins phasing out at $75,000 of modified AGI for individuals and $150,000 for married couples filing jointly, and higher income can raise Medicare premiums two years later. Households approaching $505,000 should also know where the expanded state and local tax (SALT) deduction starts to shrink.
Take your required minimum distributions, and think about giving them away
If you’re 73 or older, you generally need to take your required minimum distribution (RMD) from traditional IRAs and most workplace plans by December 31, and missing it can trigger a penalty. If 2026 is your first RMD year, you have until April 1, 2027, but waiting means taking two distributions in 2027, which could push you into a higher bracket.
If you give to charity, a qualified charitable distribution (QCD) is one of the most efficient tools available. Once you reach 70½, you can send up to $111,000 directly from your IRA to a qualified charity in 2026, and the gift can count toward your RMD without adding to your taxable income. Just leave your custodian time to process the transfer before December 31.
Rethink charitable giving under the new rules
Charitable giving looks different this year for almost everyone. If you take the standard deduction, you can now deduct up to $1,000 in cash gifts ($2,000 for married couples filing jointly) without itemizing, while itemizers can only deduct the portion of their giving that exceeds 0.5% of their AGI. Jeff Daniher walked through what these changes mean and how to plan around them in his recent article on charitable giving in 2026, which is worth reading before you make your year-end gifts.
Review your taxable investment accounts
Tax-loss harvesting means selling investments worth less than you paid to offset gains, with up to $3,000 of any excess offsetting ordinary income, as long as you avoid buying a substantially identical investment within 30 days before or after the sale. The opposite move can make sense too. In 2026, married couples with taxable income up to $98,900 and single filers up to $49,450 fall within the 0% long-term capital gains bracket, so a lower-income year may let you realize some gains without federal tax.
Use your workplace benefits before they reset
Benefits often hold money or choices that disappear on December 31:
- Health FSA: The 2026 limit is $3,400. Many plans are use-it-or-lose-it, though some allow a carryover of up to $680 or a short grace period, so check your balance and schedule any eye exams, refills, or dental work before year-end.
- Dependent care FSA: The limit rose to $7,500 per household in 2026, its first permanent increase since 1986, so make sure your 2027 election reflects it.
- HSA: You can contribute up to $4,400 for self-only coverage or $8,750 for family coverage in 2026, plus $1,000 more at 55 or older. Contributions through payroll also skip Social Security and Medicare taxes.
- Open enrollment: Revisit your health plan, insurance coverage, and spending account elections for 2027 instead of letting last year’s choices roll over. If you’re on Medicare, open enrollment runs October 15 through December 7.
Make the most of annual gifting and education savings
You can give up to $19,000 to any individual in 2026 without touching your lifetime exemption, and married couples can give twice that. With the federal estate and gift tax exemption now permanently set at $15 million per person for 2026, there’s less pressure to rush large gifts, though year-end is still a good time to review beneficiary designations, trusts, and powers of attorney.
529 contributions count toward that exclusion, and Ohio residents can also deduct up to $4,000 per beneficiary per year from state taxable income for contributions to Ohio’s 529 plan, with any excess carried forward. Contributions must be made by December 31 to count for 2026.
Your year-end planning timeline
- By the end of October: Review 401(k) contributions and FSA balances, and note your open enrollment deadline.
- By December 7: Finalize Medicare plan choices for 2027.
- By mid-December: Complete Roth conversions, RMDs, QCDs, and charitable and annual exclusion gifts.
- By December 31: Finish tax-loss harvesting, 529 contributions, and FSA spending.
- By April 15, 2027: Make 2026 IRA and HSA contributions if you haven’t already.
Seeing how the pieces fit together
Each of these moves is manageable on its own, but the real value comes from seeing how they affect one another, since a Roth conversion can change your Medicare premiums and your giving strategy can change whether you itemize. Our advisors at Bluespring Wealth – River Valley can help you decide which strategies fit and coordinate with your tax professional, so reach out to your advisor or schedule a conversation with our team.
Brad Ritter is an Associate Financial Advisor based in Bluespring Wealth’s Cincinnati office. He assists with developing comprehensive financial plans, supporting portfolio management activities, and helping ensure client accounts remain aligned with each client’s goals and preferences. Brad enjoys being part of the process that helps clients gain clarity and confidence in their financial lives.
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