Important Financial Actions to Take Before the End of 2026

By Justin Linthicum, CPA, CFP®

It’s easy to push financial planning to January, but several of the most important moves only work if you make them before December 31. If you miss the date on these, the opportunity is gone until next year… sometimes for good. IRA contributions are the exception; those generally stay open until the federal tax filing deadline the following spring. A year-end review helps you sort which is which before the window closes.

Let’s discuss what to evaluate before 2026 ends.

Review Your Retirement Account Contributions

In 2026, if you’re 50 or older, an $8,000 catch-up applies on top of the$24,500 base deferral limit, and if you turn 60 to 63 this year, a larger “super catch-up” of $11,250 replaces the standard catch-up rather than stacking on top of it. Traditional and Roth IRA limits rose to $7,500, with a $1,100 catch-up for those 50 and up. Some 457(b) and 403(b) plans carry separate catch-up rules of their own.

If your FICA wages from the employer sponsoring your plan topped $150,000 in 2025, your catch-up contributions for 2026 generally must go into a Roth account. This applies to the catch-up amount only (not the regular deferral) and only if the plan offers both catch-up and Roth. Check with your plan administrator if you’re not sure whether your plan offers that option yet.

Take Your Required Minimum Distribution

Your RMD age depends on when you were born, generally 73 if you were born between 1951 and 1959, or 75 if you were born in 1960 or later. If you miss your deadline, the IRS can charge a 25% excise tax on the shortfall, though that can drop to 10% if you correct it within the statutory correction window. 

Traditional IRA RMDs can generally be combined and withdrawn from any one or more of your traditional IRAs, and 403(b) accounts have their own aggregation rule among themselves, but RMDs from separate employer plans generally must be calculated and taken plan by plan. Inherited accounts follow a different set of rules, and not every beneficiary owes an RMD every year. Confirm your specific requirement rather than assuming it matches the standard one.

Manage Your Investment Gains and Losses

If you’re holding investments at a loss, selling before year-end can offset gains elsewhere in your portfolio. Losses beyond your gains can reduce ordinary income by up to $3,000, with anything left over carried forward to future years. 

Meanwhile, for 2026 the 0% long-term capital gains rate applies up to $49,450 in taxable income if you’re single, or $98,900 if you’re married filing jointly, so retirees with lower income years may be able to pay no federal long-term capital gains tax.

Make the Most of Charitable Giving

If you’re 70½ or older, a qualified charitable distribution lets you send up to $111,000 directly from an IRA to charity in 2026, and it counts toward your RMD without adding to your taxable income. If you’d rather bunch several years of giving into one deduction, a donor-advised fund lets you contribute now, take the deduction this year, and distribute the funds to charities over time. 

Donating long-term appreciated stock directly to a charity or DAF is its own strategy, distinct from a QCD, and lets you avoid the capital gains tax while still claiming a deduction if you itemize.

Use What’s Left in Your FSA

If you have a flexible spending account (FSA), check your plan’s rules before the funds disappear. A plan may allow up to $680 in unused 2026 funds to roll into next year, but only if your employer’s plan elects that option. Some plans offer a grace period into mid-March instead, since a plan generally can’t offer both a carryover and a grace period. Others give you a separate window to submit receipts for expenses you’ve already incurred.

If you have a dependent-care FSA, check that deadline separately, since the rules don’t always match.

Review Your Estate Plan and Annual Gifts

Marriage, divorce, a birth, a death, or a major purchase or sale this year are all reasons to pull your estate plan back out and confirm your beneficiaries still reflect your wishes. 

If you’re planning to gift money to family before year-end, the 2026 annual exclusion is $19,000 per recipient, or you can front-load up to $95,000 into a single 529 account and treat it as spread over five years for gift tax purposes.

Work With a Coordinated Team

Year-end financial decisions directly impact your broader tax, estate, and investment plans. 

A Roth conversion changes your Medicare premium calculation two years out. A charitable gift changes what you can safely realize in capital gains. Consulate Wealth has CPAs on staff working alongside the advisors, so these pieces get reviewed together instead of one at a time.

Would you like a second look at your year-end plan before the window closes? You can reach our team at (410) 823-7283 or schedule a time through our website.

Frequently Asked Questions About Year-End Financial Actions

What financial moves should I make before December 31, 2026?

Priority items include maximizing retirement account contributions, taking your RMD if you’re at your required age, harvesting investment losses, using qualified charitable distributions, and spending down flexible spending account funds. Most of these don’t come with a filing-season extension, and once December 31 passes, that year’s opportunity is gone. IRA contributions are an exception; those generally remain open until the federal tax filing deadline the following spring. Our tax planning process is built around catching the true deadlines before they pass.

Do I have to take my RMD before the end of the year?

Generally, yes, once you reach your RMD age (73 if you were born between 1951 and 1959, or 75 if you were born in 1960 or later), with one exception for your very first RMD, which can wait until April 1 of the following year. Missing the deadline triggers a 25% excise tax on the amount not withdrawn, though the IRS can reduce that to 10% if you correct it within the statutory correction window. A retirement income plan built around your specific RMD schedule helps you avoid last-minute surprises.

How much can I contribute to a 401(k) in 2026?

The 2026 limit is $24,500, plus an $8,000 catch-up if you’re 50 or older. Workers turning 60 to 63 this year get a larger “super catch-up” of $11,250 instead of the standard amount. Contributions above these limits create an excess deferral that must be corrected, so it’s a good idea to check your numbers against your investment plan before year-end.

What is a qualified charitable distribution and how much can I give?

A qualified charitable distribution is a direct transfer from an IRA to a qualified charity, available once you turn 70½. For 2026, you can give up to $111,000 this way. It counts toward your RMD but isn’t added to your taxable income, and it’s the kind of decision that fits naturally into how we build a plan with each client before choosing between a QCD and a donor-advised fund.

What’s the gift tax exclusion for 2026?

You can give up to $19,000 per person in 2026 without filing a gift tax return or touching your lifetime exemption. Married couples can combine exclusions to give $38,000 per recipient. Gifts above that amount generally require filing a gift tax return (Form 709) and use up part of your $15 million 2026 lifetime exclusion, rather than creating an immediate tax bill in most cases; our Consulate Journal has more on gifting strategies if you want to go deeper.

About Justin

Justin Linthicum, CPA, CFP®, is a Wealth Advisor and Senior Tax Accountant at Consulate Wealth, where he works with clients on tax planning, estate planning, investment planning, and retirement planning, with a particular focus on conversion opportunities and how evolving tax laws affect a client’s financial picture. A graduate of Towson University with dual degrees in accounting and business administration, Justin brings a CPA’s precision to every plan he builds.