Your Year-End Checklist: RMDs, Gifting & Last-Minute Tax Moves

by Joel R. Freedman, CFP®, CPWA®, Managing Director

As the year draws to a close, now is the perfect time to review your entire financial picture.

Year-end planning isn’t just about crossing tasks off a list—it’s about strategically managing retirement accounts, gifting opportunities, and tax positions to protect and grow your wealth.

Here’s a practical guide to help make sure nothing falls through the cracks.

Review Required Minimum Distributions (RMDs)

If you’re 73 or older, the IRS mandates that you take RMDs from most traditional IRAs and retirement plans. Missing a distribution can trigger a 25% excise tax on the amount you should have withdrawn¹. Take some time to:

• Confirm your RMD amounts for each account.
• Coordinate withdrawals across accounts if you have multiple IRAs or 401(k)s.
• Consider charitable contributions through a Qualified Charitable Distribution (QCD), which allows your RMD to go directly to a charity and count toward satisfying the RMD without increasing your taxable income.

Tip: There’s still time to complete a Roth conversion for the 2025 tax year and benefit from tax-free growth and future withdrawals—just confirm it won’t push you into a higher tax bracket.

Make Strategic Gifting Moves

The end of the year is also an ideal time to leverage gifting strategies to help reduce your taxable estate while supporting family or your favorite causes. Moves to consider include:

• Annual Exclusion Gifts: You can gift up to $19,000 per recipient in 2025 without using your lifetime gifting exemption. For couples, that doubles to $38,000.²
• Charitable Contributions: Donor-Advised Funds (DAFs) allow you to make a large charitable gift in 2025 (and receive a deduction) while deciding which charities receive the funds later.

Tip: Starting in January, itemized charitable deductions will be capped at 35% for all taxpayers and only contributions above 0.5% of AGI will qualify.³  Consider “bunching” several years of giving in 2025 to take advantage of the current rules.

Evaluate Other Tax Planning Moves

Timing is everything when it comes to taxes. A few thoughtful steps now can make a meaningful difference in the new year. Think about:

• Income Timing: Defer or accelerate income depending on your expected tax bracket for 2025 versus 2026.
• Capital Gains & Losses: Harvest losses to offset gains in your portfolio— but avoid buying similar securities within 30 days before or after the sale or you could lose your ability to claim the deduction.
• Maximize Contributions: Max out funding to IRAs, 401(k)s, and other tax-advantaged accounts (such as 529 plans or Health Savings Accounts) to reduce your taxable income.
• Itemized Deductions: Review mortgage interest, property taxes, charitable contributions, and medical expenses to optimize deductions for 2025.

Tip: In some cases, establishing multiple non-grantor trusts—each benefiting from a separate $40,000 SALT cap—can support strategic lifetime gifting, estate planning, and help you shift into a lower tax bracket.

Meet With Your Advisory Team

Estate and Gift Tax Exemptions
OBYear-end coordination among with your financial advisor, accountant and estate planning attorney is essential. In addition to ensuring your strategies align you can:

• Update your estate plan to reflect any major life changes
• Confirm beneficiaries are current across accounts, insurance policies, and legal documents
• Review your cash flow, liquidity, and emergency reserves
• Determine whether your portfolio needs rebalancing
• Maximize tax-planning opportunities related to the OBBBA and applicable state laws

Q&A: Common Year-End Questions

Q: How do RMDs affect my taxable income and Medicare premiums?
A: RMDs are included in your taxable income, which could push you into a higher tax bracket and increase Medicare Part B and D premiums. Strategically timing withdrawals or using QCDs can help counteract this.

For many retirees, RMDs can also increase the amount of their Social Security benefits that are subject to taxation. As your overall income rises due to RMDs, a larger portion of your Social Security benefits may become taxable, further increasing your tax liability.

Q: What’s the best way to use the annual gift exclusion before year-end?
A: You can gift up to $19,000 per recipient without affecting your lifetime exemption. Consider gifting to loved ones, funding 529 education plans, or contributing to trusts—just make sure gifts are completed and documented before December 31.

Q: Can I make charitable contributions after December 31 but still count them for 2025?
A: Generally, charitable contributions must be made by December 31 to count for that tax year. However, you may fund a Donor-Advised Fund before year-end and recommend distributions to charities in the following year, allowing you to maximize deductions for 2025.

Get Started Today

We know the holidays can be hectic, but a few thoughtful actions now can help protect your wealth, reduce taxes, and set your family up for a more strategic start to 2026.
Let’s connect and close out the year with confidence.

Sources
¹https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-required-minimum-distributions-rmds
²https://www.irs.gov/instructions/i709
³https://www.journalofaccountancy.com/newsletters/pfp-digest/how-obbba-alters-charitable-deduction-strategies-for-2025-and-2026/