Year-End Tax Planning Checklist for High Earners

Year-End Tax Planning Checklist for High Earners

Most tax-reducing moves expire on December 31, not April 15. The window between October and year-end is when most of the meaningful decisions get made — or missed.

Why year-end matters more than the April deadline

401(k) contributions, Roth conversions, tax-loss harvesting, and charitable moves all have a hard December 31 deadline. Only IRA contributions and HSA contributions (for HDHP participants) extend to the tax filing deadline in April. If you're waiting until April to think about last year's taxes, most of the levers have already been pulled out of reach.

Know your bracket before you act

Year-end tax planning starts with a current-year income estimate. Before making Roth conversion moves, charitable contributions, or harvesting decisions, understand:

• Your estimated total income for the year
• Your estimated deductions (standard or itemized)
• The gap between your current income and the next bracket threshold
• Any expected capital gains from rebalancing or property sales

Roth conversion window management

A Roth conversion — moving money from a Traditional IRA to a Roth IRA — is taxable in the year you do it, but the converted amount grows and withdraws tax-free going forward. The best conversion years are low-income years: the year you retire before RMDs start, a year with large deductions, or a year when income temporarily drops.

Identify how much room remains before the top of your current bracket. Converting up to that threshold keeps you in the same bracket while building future tax-free assets.

Tax-loss harvesting mechanics

Selling investments that have declined in value to realize a capital loss can offset capital gains realized elsewhere in your portfolio. The losses carry forward indefinitely if not fully used in the current year.

Wash sale rule

You cannot repurchase the same (or substantially identical) security within 30 days before or after the sale without losing the tax loss. You can buy a similar but different fund immediately — the goal is maintaining market exposure while establishing the loss.

Charitable giving optimization

Qualified Charitable Distribution (QCD)

For IRA holders age 70½ or older, a QCD allows a direct transfer from a Traditional IRA to a qualified charity — up to $105,000 per person in 2024 — that is excluded from income entirely. QCDs count toward the required minimum distribution and are the most tax-efficient charitable strategy available to eligible retirees.

Donor Advised Fund (DAF)

A DAF allows you to make a large, deductible contribution in one high-income year — taking the deduction now — and distribute the funds to charities over multiple years. Useful for bunching giving into a year where itemizing is advantageous.

Questions to ask before December 31

• What is my estimated taxable income this year vs. my bracket ceiling?
• Is there room to convert Traditional IRA funds to Roth without moving into a higher bracket?
• Do I have capital gains I can offset with unrealized losses before year-end?
• Am I age 70½ or older with an IRA — is a QCD the right charitable vehicle?
• Have I maxed my 401(k), HSA, and any FSA contributions?
• Are there deductions I can accelerate into this year (e.g., prepaying state/local taxes where allowable)?

Final takeaway

Year-end tax planning is not about filing — it's about acting while the levers are still available. The window is short, the moves are concrete, and many of them permanently reduce what you'll owe over the rest of your life.

General educational information only and not individualized tax advice. Tax limits and rules are subject to annual IRS updates and legislative change. Consult a qualified tax professional for guidance specific to your situation.

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