2026 Year-End Planning

Fund retirement accounts

Consider maximizing contributions to employer-sponsored retirement accounts, like 401(k), 403(b), and governmental 457 plans, and Individual Retirement Accounts (IRAs) for tax-advantaged growth potential. The deadlines are generally December 31, 2026, for employer-sponsored plans and April 15, 2027, for IRAs.

Why it matters

Contributions to certain retirement accounts may be tax-deductible, helping to reduce your income tax bill.

While not all retirement accounts offer this benefit, funding your retirement account may give your money the potential to grow tax-deferred (or tax-free in certain situations), helping to maximize your retirement savings.

Contribute to education savings

To help children or grandchildren afford higher education, consider funding a 529 plan. These plans have the potential to grow tax-deferred, and distributions may be federal tax-free if used for qualified education expenses.

Why it matters

Recent legislation expanded the definition of qualified education expenses allowing more permitted uses for 529 assets.

Along with funding education, gifting to 529 plans can help reduce the size of your taxable estate.

Please consider the investment objectives, risks, charges and expenses carefully before investing in a 529 savings plan. The official statement, which contains this and other information, can be obtained by calling your financial advisor. Read it carefully before you invest. The availability of such tax or other benefits may be conditioned on meeting certain requirements.

Take required minimum distributions from retirement accounts

If you have attained the age to take required minimum distributions (RMDs) or have inherited an IRA, you may be required to take an RMD annually by December 31. Ask your tax advisor for details.

Why it matters

If you don’t take your full RMDs by the deadline, you may be subject to an IRS 25% excise tax for every dollar under-distributed. This may be reduced to 10% if you correct the shortfall during a two-year correction window.

Donate to charity

Consider making gifts to charities. Review the timing of these gifts with your tax advisor to potentially maximize your tax deductions.

Why it matters

Charitable donations may be tax-deductible as an itemized deduction and may offer planning flexibility if you choose to consolidate multiple years of planned charitable gifts into a single tax year. For 2026, your itemized deductions generally must exceed $16,100 (single filers) or $32,200 (married/joint) for you to benefit from that charitable gift.