As Summer starts to wind down, the carefree season of vacations quickly gives way to school, fall sports, annual deadlines, and holidays that seem to arrive faster every year.
Before the year-end rush takes over, now is a good time to review a few financial items that are much easier to address in August or September than late December. A quick check today could help you avoid missing a savings goal, overlooking a tax-planning opportunity, or discovering a problem when there’s little time left to fix it.
So what should be on your year-end financial checklist?
Start with these five areas: retirement contributions, required minimum distributions, charitable giving, education savings, and tax withholding.
Am I on Track to Max Out My Retirement Contributions in 2026?
With several months remaining in the year, now is a good time to check how much you’ve contributed to your retirement accounts and whether you’re on track to reach your 2026 savings goals.
What Is the 2026 401(k) Contribution Limit?
For 2026, the employee contribution limit for 401(k), and 403(b), and most TSP accounts is:
· Base contribution limit: $24,500
· Age 50 to 59 or 64 and older: Additional $8,000, catch-up contribution
· Age 60-63: Additional $11,250 catch-up contribution
These limits apply to your own employee contributions and do not include employer matching or other employer contributions.
Check your most recent paystub or retirement account statement to see how much you’ve contributed so far and whether you’re on pace to reach your year-end savings goal. Both documents should help you determine how much you are on track to save and whether adjustments are needed.
Also check that you’re contributing enough to receive any employer match available to you. You don’t want to reach December and realize you left part of that benefit on the table.
What is the 2026 IRA Contribution Limit?
For 2026, the IRA contribution limits are:
· Base contribution limit: $7,500
· Age 50 and older: Additional $1,100 catch-up
You generally have until the tax-filing deadline in 2027 to make an IRA contribution for the 2026 tax year. But waiting until the deadline isn’t necessarily the best strategy. Contributing earlier gives your money more time to be invested.
Year-end is also a good time to estimate your 2026 income. Income limits can affect whether you’re eligible to contribute directly to a Roth IRA and whether a traditional IRA contribution is deductible.
If your income is close to one of those limits, identifying the issue before year-end gives you more time to determine the appropriate next steps rather than discovering it while preparing your tax return.
When Do I Need to Take My Required Minimum Distribution (RMD)?
If you don’t know what your Required Minimum Distribution (RMD) is for the year, now is a good time to find out. Check your IRA account statement or contact your advisor if you are not sure. Have a plan in place for when and how you would like to satisfy the requirement so that you’re not stuck in a bind in late December.
For most people required to take a RMD, the deadline is December 31. The primary exception is your very first RMD, which may be delayed until as late as April 1 of the following year. Keep in mind that delaying your first RMD could result in taking two RMDs in the same calendar year, which may increase your taxable income for that year
Planning ahead also gives you time to consider how you want to satisfy your RMD. If you’re charitable inclined, one option may be a Qualified Charitable Distribution (QCD), which brings us to another item worth reviewing before year-end.
Can a Qualified Charitable Distribution Help Satisfy My RMD?
On the topic of RMDs, many individuals who are charitably inclined choose to complete a Qualified Charitable Donation (QCD), which is a strategy with some additional tax advantages that helps you satisfy the RMD while not increasing your taxable income as the RMD ordinarily does. If you are charitably inclined and required to take a RMD, a Qualified Charitable Donation (QCD) may allow you to accomplish both at the same time. A QCD allows eligible individuals to make a distribution directly from an IRA to a qualifying charity, and the distribution can count toward satisfying some or all of your RMD.
A QCD can also offer an important tax advantage. Instead of taking an RMD that is generally included in your taxable income and then making a charitable donation, a properly completed QCD is generally excluded from taxable income.
If charitable giving is already part of your plan for the year, now is a good time to get ahead of your planned giving and avoid the year-end rush. Nearly 10% of all charitable giving occurs in the final three days of the year. If your donation gets left hanging in the year-end rush and isn’t processed until after January 1st, your tax situation may look different than you intended. (1)
Getting this item off your to-do list now can help ensure your charitable intentions and RMD strategy are completed the way you intended.
Do I Need to Make My Virginia 529 Contribution Before December 31?
If you’re planning to make a Virginia 529 contribution and want it to count toward your 2026 Virginia state income tax deduction, don’t wait until tax season. Unlike IRA and Roth IRA contributions, you generally can’t make a prior-year 529 contribution after December 31.
For Virginia taxpayers, the state income tax deduction is:
- Under age 70: $4,000, per year, per account owner, per beneficiary
- Age 70 and older: The $4,000 annual deduction limit does not apply
Keep in mind that this is a Virginia state tax deduction. There is no federal income tax deduction for contributions to a 529 plan.
Also, the $4,000 deduction limit isn’t necessarily the most you’re allowed to contribute to the account. It limits how much of your contribution you can deduct for Virginia income tax purposes in a given year, subject to the applicable rules.
Another important caveat is that, unlike IRAs and Roth IRAs, prior year contributions are not an option – this means that if the funds are not in the account by 12/31, then you have missed the window for the contribution to create a state tax deduction
The important year-end takeaway is the deadline. If contributing to a 529 is on your financial to-do list for 2026, make sure the contribution is completed by December 31 if you want to consider it for this year’s Virginia state income tax deduction.
Should I Check My Tax Withholding Before Year-End?
A surprise at tax time is not something that anyone likes dealing with. If you’ve had any meaningful changes this year that impact your tax situation, now is a good time to check your withholding and make any necessary adjustments while you still have a few months left in the year.
Anew job or a significant change in income can affect how much you should be withholding. Changes to your family situation, such as getting married or having a child, can also change your tax picture.
Another reason to check your withholdings is if you had an unwelcome surprise last April. If you owed significantly more than expected, or received a particularly large refund, it may be worth asking whether an adjustment could put you closer to your target this year.
If any of these things apply to you, review your paystubs and consider checking your year-to-date withholding against your tax liability. Your accountant or tax-planning software can also help you determine whether an adjustment may be appropriate.
The advantage of checking now is that you still have time to do something about it. Making an adjustment over the remaining pay periods may be much easier than discovering the problem when you file your tax return next spring.
Don’t Wait Until December
The good news is that there several months remain in the year. Taking a little time now to review your retirement contributions, charitable giving, education savings, and tax withholdings can help you identify anything that needs attention while there’s still time to act.
After all, the goal is to avoid getting to December and thinking, “ I should have done this sooner.”
If you have any questions about your specific situation or how any of these-year-end planning items may apply to you and your family, don’t hesitate to reach out to your advisor at EBW. A conversation now may help you determine what belongs on your financial to-do list before December 31st.
As always, if you have any specific questions about your situation or how any of these things could apply to you or your family, please don’t hesitate to contact your advisor at EBW.
(1) https://www.kiplinger.com/retirement/how-to-keep-charitable-giving-momentum-going-all-year
This material is provided for educational purposes only and is not intended as individualized investment, tax, legal, or accounting advice. The information presented is general in nature and may not be applicable to all investors. Individuals should consult with their tax, legal, and financial professionals regarding their specific circumstances before implementing any strategy discussed. Investing involves risk, including the possible loss of principal. Past performance is not indicative of future results.
Contributions to a 529 plan may be eligible for certain state tax benefits. State tax treatment varies and is subject to change. Before investing, investors should consider the plan's investment objectives, risks, charges, and expenses. Investors should also consider whether their home state offers tax or other benefits available only through participation in that state's qualified tuition program.