Year-End Tax Moves to Make Before 2027

Most tax moves for 2026 have to happen in 2026. Once January 1, 2027 arrives, a Roth conversion, a loss harvest or a new piece of equipment counts toward 2027, not 2026. A few contributions are the exception: they can wait until you file.

Moves that must happen by December 31, 2026

1. Finish your 401(k) deferrals

401(k) money counts in the year it comes out of your paycheck. For 2026 the employee limit is $24,500. At 50 or older you can add $8,000, or $11,250 if you are 60 to 63. If your bonus or last paychecks of the year are where you planned to catch up, change your payroll election now; most payroll teams need a few weeks.

New for 2026: if your 2025 Social Security wages were over $150,000, your catch-up contributions have to go in as Roth. Check that your plan is handling this.

If you already have a solo 401(k), make your 2026 employee deferral election by December 31. Employer profit-sharing contributions can wait until your filing deadline. The Solo 401(k) guide has the math.

2. Decide on a Roth conversion

A Roth conversion counts in the year the money moves, so the 2026 deadline is December 31. Conversions can no longer be undone. A conversion makes sense in a year your income is lower than usual, for example a sabbatical, a business loss or the gap between retirement and Social Security. The Roth conversion ladder guide and the backdoor Roth IRA guide cover both versions.

3. Harvest losses, and maybe gains

Losses: selling an investment at a loss by December 31 lets the loss offset your 2026 capital gains, plus up to $3,000 of other income. Don't buy the same or a substantially identical investment within 30 days before or after the sale, or the wash-sale rule disallows the loss. See tax-loss harvesting.

Gains: if your 2026 taxable income is low, long-term gains up to the top of the 0% bracket are tax-free. That line is $49,450 of taxable income for single filers and $98,900 for joint filers. Selling and buying back resets your cost basis higher at no tax cost. See tax-gain harvesting.

4. Give to charity the smart way

Gifts count in the year you make them: a check mailed or a card charged by December 31.

• Give appreciated stock instead of cash. You deduct the full value and never pay tax on the gain.
• Bunch if you itemize only some years. Two or more years of giving in one year, often through a donor-advised fund, can push you over the standard deduction. See bunching deductions.
• Know the 2026 rules. Itemizers deduct only the part of their gifts above 0.5% of AGI, and people in the 37% bracket get at most a 35% benefit. If you take the standard deduction, you can still deduct up to $1,000 ($2,000 joint) of cash gifts to public charities. Gifts to a donor-advised fund don't count for that one.
• 70½ or older? A qualified charitable distribution from your IRA goes to charity tax-free and counts toward your required minimum distribution.

5. Take your required minimum distribution

If you are 73 or older, your 2026 RMD is due by December 31, 2026. Only your very first RMD can wait until April 1 of the next year, and that puts two RMDs in one tax year. Missing one costs a 25% excise tax on the shortfall, or 10% if you fix it quickly.

6. Place business equipment and rentals in service

Property acquired after January 19, 2025 qualifies for 100% bonus depreciation, and Section 179 allows up to $2,560,000 for 2026. Either way, the property has to be placed in service, meaning ready and available for use in the business, by December 31. Paying for it in December is not enough if it arrives in January.

The same rule applies to rentals. A short-term rental has to be ready and available for guests in 2026 for a 2026 cost segregation study to pay off this year. If you are using the short-term rental loophole, your material participation hours have to be logged in 2026 too.

7. Finish the business-owner items

• S-corp owners: run your reasonable salary through payroll by December 31, and put health insurance for 2%-plus shareholders on the W-2. See the S-corp strategy guide.
• Augusta rule: if your business rents your home for meetings, the up-to-14 days have to happen in 2026, with minutes and a fair rent. See the Augusta rule guide.
• Pass-through entity tax: states set their own election and payment deadlines, and a payment made in 2026 is what counts for a 2026 deduction. Check your state now. See pass-through entity tax.

8. Make your annual gifts

You can give up to $19,000 per person in 2026 without using any of your lifetime exemption, and $38,000 per person as a married couple. The exclusion does not carry over: a gift made on January 2, 2027 counts toward 2027.

Moves that can wait until April 15, 2027

These count for 2026 as long as they are made by the filing deadline:

The fourth-quarter estimated tax payment for 2026 is due January 15, 2027. If you are paying tax on an old Opportunity Zone gain this year, read the Opportunity Zone tax bill due in April 2027 first.

2027 elections to set during open enrollment

If your employer lets you set a 401(k) percentage instead of a dollar amount, pick one that reaches the limit by your last paycheck and revisit it when the 2027 limit is announced. What else changes next year is in 2027 tax changes.

Sources

• IRS Rev. Proc. 2025-32 (2026 inflation adjustments: capital gains brackets, Section 179, gift exclusion, health FSA)
• IRS Notice 2025-67 (2026 retirement plan and IRA limits)
• IRS Rev. Proc. 2026-24 (2027 HSA limits)
• Internal Revenue Code sections 168(k) and 179 (bonus depreciation and expensing), 170 (charitable deductions, as amended by Public Law 119-21), 401(a)(9) and 4974 (RMDs and the excise tax), 408(d)(8) (qualified charitable distributions), and 1091 (wash sales)