The holidays are upon us, and 2026 will be rolling in before you know it. Here are a few tax-specific items we recommend you revisit as 2025 draws near its conclusion.
Important Year-End Tax Planning Items to Evaluate Before 2025 Ends
Capital Gains
If you have any large capital gains, now is an excellent time to harvest offsetting losses to neutralize that gain.
Charitable Contributions
Charitable contributions are a great way to reduce your tax liability and continue the mission of worthy organizations through your gifts. Some technical details to be mindful of:
Deadlines & Limits
- The deadline for charitable contributions to receive a deduction for 2025 is December 31, 2025.
- The annual federal gift tax exclusion is $19,000 per person.
Charitable Contribution Strategies to Consider
- Consider avoiding future capital gains by giving highly appreciated (low basis) securities or real estate instead of cash. This will take time and careful planning.
- Qualified Charitable Distributions (QCD) are another great way to give:
- A QCD allows you to give directly to a charity from your IRA (up to $100,000).
- This amount will be tax-free to both you and the charity.
- The amount given may also be used to satisfy your Required Minimum Distributions (RMDs) for the year.
Retirement Plan Contributions
You have until December 31, 2025, to make additional contributions to your employer’s 401(k) or 403(b) retirement plan. Your plan structure may dictate these rules.
Contribution Limits for 2025:
- 401(k) salary deferral limit: $23,500
- 401(k) catch-up (ages 50+): $31,000
- SIMPLE 401(k) limit: $16,500
- SIMPLE 401(k) catch-up (ages 50+): $20,000
- SIMPLE 401(k) enhanced catch-up (ages 60–63): $21,750
Please consult your tax advisor for details on allowable SEP IRA contribution limits.
Roth IRA and Traditional IRA Contributions
- IRA contributions can be made until April 15, 2026.
- The limit for 2025 is $7,000 (or $8,000 if you are age 50+).
Roth Conversions
Roth conversions can be a powerful tax-planning tool for future RMD reduction, legacy planning, or even opportunistic maneuvering during low-income years or market downturns.
- The deadline for Roth conversions is December 31, 2025.
Education Planning
The South Carolina 529 College Savings Plan (Future Scholar)
- Contribution deadline is April 15, 2026
- Contributions are state tax-deductible.
Funding Strategies
- Consider “Frontloading” a 529 Plan if you have a lump sum rather than relying on future cash flow contributions.
- You may be able to contribute up to 5x the annual gift tax exclusion ($85,000 for individuals or $170,000 for married couples) if the total lifetime limit is not exceeded.
Rollover Options
- Up to $35,000 in unused 529 funds may also be eligible for rollover into a Roth IRA.
- Discuss potential eligibility with your advisor and tax professional.
Required Minimum Distributions (RMDs)
RMD Requirements
- Take all RMDs from qualifying retirement accounts by the December 31, 2025, deadline.
- Penalties apply for not taking an RMD.
Account Management Tips
- Don’t forget accounts that may be held outside of Global View.
- Consider consolidation if you find it difficult to keep up with multiple RMDs.
Inherited IRAs
Rules for Beneficiaries (Post-2019 Deaths)
- New rules apply to beneficiaries of Inherited IRAs from account owners who passed after 2019.
Timing Requirements
- Most non-spouse beneficiaries must empty the Inherited IRA within 10 years of the account owner’s passing.
- Penalties apply to any amount remaining after 10 years.
Annual RMD Considerations
- If the deceased account owner was at RMD age, the beneficiary must also continue taking annual RMDs in addition to ensuring the account is empty by the 10th year.
The year-end is a great time to review your estate plan. This would include reviewing your:
- Personal Representative
- Trustees of any trust
- Guardian for your minor children
- Agents for your durable power of attorney
- Agents for healthcare powers of attorney
- Beneficiaries of your will
- Life insurance beneficiaries
- Retirement account beneficiaries.
We recommend consulting with your tax advisor for specifics to your situation.
Important Note:
Any requests with a December 31, 2025, deadline must be received before December 5 to allow for adequate processing time. Requests received after December 5 are completed on a best-efforts basis.