Five Tax Strategies Worth Considering Before Year-End

Most people think about taxes once a year — when they’re filing. But tax planning actually happens in the 11 months before you file. By the time you’re sitting with a tax preparer in April, most opportunities have passed. 

The question worth asking: Are you planning for taxes, or just reacting to them? 

Why timing matters 

Many tax-related decisions need to happen before December 31. f you wait until tax season, you’re filing a return based on decisions that have already been made. The planning window is before those decisions lock in. 

Here are five tax strategies worth considering before year-end. 

Strategy 1: Maximize pre-tax retirement contributions 

If you have access to a 401(k) or 403(b), pre-tax contributions reduce your current taxable income while building retirement assets. For 2026, contribution limits are: 

• $24,500 if you’re under 50 
• $32,500 if you’re 50 or older 

This is one of the most commonly used tax-planning strategies available. The contributions come out of your paycheck before taxes, which lowers your taxable income for the year. The account then grows tax-deferred until you withdraw the funds in retirement. 

If you’re not currently maxing out your contributions and you have room in your budget, it may be worth evaluating whether increasing your contribution rate makes sense for your situation. 

Strategy 2: Fund a Health Savings Account (HSA) 

If you have a high-deductible health plan, you may be eligible to contribute to an HSA. For 2026, contribution limits are: 

• $4,400 for individuals 
• $8,750 for families 

HSAs offer what’s often called a triple tax advantage: 

• Contributions may be tax-deductible 
• The account grows tax-free 
• Withdrawals for qualified medical expenses are tax-free 

Many people view HSAs as a way to cover current healthcare costs. But if you can afford to pay medical expenses out of pocket and let the HSA grow, it can function as an additional retirement savings vehicle. There’s no requirement to withdraw funds in the year you incur the expense—you can reimburse yourself years later, and the account continues to grow in the meantime. 

Strategy 3: Consider How You Manage Equity Compensation 

If you receive RSUs or stock options as part of your compensation, how you manage them can affect your tax picture. 

Two common approaches: 

• Sell as shares vest: This approach can help manage concentration risk and minimize capital gains. When RSUs vest, you’re taxed on their value as ordinary income. Selling immediately means you’re not holding shares that could decline in value, creating a capital loss on top of the ordinary income tax you’ve already paid. 
• Hold shares for at least one year: If you hold vested shares for more than a year before selling, any gains are taxed as long-term capital gains, which are generally taxed at a lower rate than ordinary income. 

The right approach depends on your concentration risk, tax situation, and broader financial picture. If a significant portion of your net worth is already tied up in company stock, holding more may not be appropriate regardless of the tax treatment. 

Strategy 4: Evaluate charitable contributions 

If you’re charitably inclined, a new rule for 2026 may be worth noting. You can now take the standard deduction and still deduct up to: 

• $1,000 for individuals 
• $2,000 for married couples filing jointly 

This makes charitable giving more tax-efficient for people who don’t itemize deductions. In prior years, you had to itemize to get any tax benefit from charitable giving. Now, even if you take the standard deduction, you can deduct a portion of your charitable contributions. 

If you’re planning to make charitable gifts anyway, understanding this rule can help you time and structure those gifts in a way that aligns with your tax planning. 

Strategy 5: Qualified charitable distributions (QCDs) 

If you’re over 70½ and have a traditional IRA, you can make direct distributions from your IRA to a qualified charity. These are called Qualified Charitable Distributions (QCDs). 

Here’s why they’re worth considering: 

• The distribution counts toward your required minimum distribution (RMD) 
• But it’s not included in your taxable income 

For people who don’t need their full RMD for living expenses and want to support charitable causes, this approach can be more tax-efficient than taking the distribution as income and then making a separate charitable contribution. 

The integration point 

These strategies often work better when coordinated. Tax planning isn’t isolated—it connects to retirement planning, compensation decisions, charitable giving, and estate considerations. 

This is where working with a financial planner (not just a tax preparer) can make a difference. A tax preparer files your return based on what’s already happened. A financial planner helps you think through decisions before they happen—when there’s still room to plan around them. 

What’s worth exploring 

You don’t need to implement all five strategies. The question is: which of these might fit your situation—and are you aware of them? 

Taxes play an important role in your overall financial picture. If you’d like to explore how OpenPlan’s services can help you, reach out to our team.  

Disclosure: This content is for informational and educational purposes only and should not be construed as individualized advice or a recommendation for any specific product, strategy, or course of action. Brighton Jones, its affiliates, and employees do not provide personalized investment, financial, tax, or legal advice through this communication. This material is not intended to, and does not, create a fiduciary relationship under ERISA or any other applicable law. For individualized advice tailored to your specific circumstances, please consult with your adviser.