Year-End Tax Planning for 2026

Why starting the conversation before year-end can create more planning opportunities

It may only be the end of summer, but year-end will be here sooner than you think. When it comes to tax planning, waiting until December can mean missed opportunities. Some decisions need to happen before the year ends.

Tax preparation and tax planning serve two different purposes. Tax preparation looks back at what already happened during the year. Tax planning looks ahead and focuses on what you can still do before December 31.

That is why September can be an important time to begin the conversation.

By reviewing your income, investments, retirement contributions, business activity, and major life changes now, you have more time to identify possible tax impacts and determine whether you need to take action before year-end.

Here are several areas individuals and business owners should consider as we enter the final months of 2026.

1. Review Your Income, Withholding, and Estimated Payments

A good place to start is by looking at how your financial picture has changed since the beginning of the year.

Maybe you received a raise or bonus, changed jobs, started a business, sold an investment, or began receiving retirement income. Any of these events could affect your overall tax situation.

For employees, this may be a good time to review your federal and state tax withholding. If too little has been withheld throughout the year, making an adjustment before year-end may help reduce an unexpected tax bill.

Those who are self-employed, own a business, or earn income without withholding should also review their estimated tax payments and make sure those payments still align with their expected income for the year.

The important question is not simply, "How much have I paid?" It is whether the amount you have paid makes sense based on where you expect to finish the year.

2. Revisit Your Retirement Strategy

Retirement contributions can play an important role in both long-term financial planning and current tax planning.

For 2026, employees can generally contribute up to $24,500 to a 401(k), 403(b), or most governmental 457 plans. Individuals age 50 and older may be eligible for additional catch-up contributions, with a higher catch-up limit available for certain individuals ages 60 through 63.

The 2026 IRA contribution limit is $7,500, with an additional $1,100 catch-up contribution available for individuals age 50 and older.

Rather than waiting until late December, review what you have contributed so far and determine whether your current contribution strategy still aligns with your goals.

Year-end may also be a good time to consider whether a Roth conversion fits into your plan. A Roth conversion generally creates taxable income in the year of the conversion, but qualified Roth withdrawals in retirement can be tax-free.

A Roth conversion is not right for everyone, and the additional taxable income can affect other areas of your financial picture. If you have been considering one, reviewing the opportunity before year-end gives you time to understand the potential tax impact before making a decision.

3. Review Investments and Charitable Giving With Taxes in Mind

Investment decisions can have tax consequences, making year-end a good time to review your portfolio from both an investment and tax perspective.

If you sold investments at a gain during 2026, those gains may create additional taxable income. At the same time, investments that have declined in value may provide an opportunity to realize losses that could potentially offset certain gains, commonly referred to as tax-loss harvesting.

Taxes should not be the only reason to buy or sell an investment, but they should be part of the conversation.

If charitable giving is already part of your financial plan, there may also be opportunities to make those contributions more tax-efficient. Depending on your circumstances, strategies such as donating appreciated assets, using a donor-advised fund, or making a qualified charitable distribution from an IRA may be worth discussing.

Planning earlier gives you time to evaluate your options rather than making investment or charitable decisions during the final days of December.

4. Consider What Has Changed in Your Life This Year

Tax planning is especially important when your life looks different today than it did at the beginning of 2026.

Consider whether you have experienced any major changes such as:

• Getting married or divorced
• Having or adopting a child
• Buying or selling a home
• Changing jobs
• Receiving a significant raise or bonus
• Starting or selling a business
• Receiving an inheritance
• Retiring
• Beginning Social Security benefits
• Making a significant investment transaction

These events can affect more than your tax return. They may also give you a reason to review your withholding, retirement strategy, investments, estate plan, insurance, or overall financial plan.

When something significant changes in your life, your tax and financial strategies may need to change with it.

5. Business Owners Should Look at the Full Picture

For business owners, September can be an especially valuable time to begin looking at year-end projections.

By this point in the year, you likely have a much clearer picture of how your business is performing than you did in January. Start by reviewing your year-to-date revenue and expenses and comparing them with what you expect during the remaining months of 2026.

If the business is having a stronger or weaker year than expected, that may affect estimated tax payments and other planning decisions.

Business owners may also want to review:

• Expected year-end income
• Estimated tax payments
• Retirement plan contributions
• Payroll and owner compensation
• Planned equipment or business purchases
• Accounts receivable and expenses
• Employee bonuses
• Business structure and longer-term planning needs

The goal should not be to spend money simply to create a deduction. Instead, year-end planning can help determine whether expenses or investments the business already needs can be timed in a way that also makes sense from a tax perspective.

It is also important to consider how business decisions affect your personal financial picture. A decision made within the business may affect your personal taxable income, retirement contributions, estimated payments, cash flow, and long-term financial plan.

Looking at these decisions together can provide a clearer picture than addressing business taxes and personal finances separately.

6. Do Not Wait Until Tax Season to Start Planning

One of the biggest differences between tax preparation and tax planning is timing.

When you prepare your 2026 tax return in 2027, most of the financial decisions that affected that return will have already been made.

By starting the conversation now, there is still time to evaluate your situation and determine whether there are actions worth considering before December 31.

Not every strategy will apply to every taxpayer. In some cases, the best decision may be to make no change at all. The value of planning is having the opportunity to evaluate those decisions while there is still time to act.

Start Your Year-End Planning Conversation

Year-end tax planning is not about finding one last-minute deduction in December. It is about understanding where you stand, what has changed, and what opportunities may be available before the year is over.

At ClearPath Financial Group, our tax-first approach looks at taxes as part of your broader financial picture. Whether you are an individual, a family, or a business owner, starting the conversation earlier can give you more time to make informed decisions for the remainder of 2026 and beyond.

If you have experienced changes in your income, business, investments, retirement plans, or personal life this year, now may be a good time to review how those changes could affect your tax situation.

Ready to start your 2026 year-end tax planning conversation? Contact us at 913-336-3500 to book an appointment and discuss what you should be thinking about before December 31!

This information is provided for general educational purposes and should not be considered individualized tax, investment, or financial advice. Tax laws and individual circumstances vary. Consult with your tax and financial professionals regarding your specific situation.