Originally published October 2015. Last updated March 2026.
The end of the year sneaks up fast. Before December 31 hits, run through this checklist to make sure you’re not leaving money on the table or setting yourself up for a tax surprise.
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Check Your Age Milestones
Certain ages trigger financial opportunities or requirements:
- Turned 50: Catch-up contributions kick in. You can now contribute $8,000 to an IRA (up from $7,000) and $31,000 to a 401(k) (up from $23,500).
- Turned 55: If you left your employer this year or later, you can access that employer’s 401(k) penalty-free (the Rule of 55).
- Turned 59 and a half: IRA and 401(k) distributions are now penalty-free.
- Turned 62: You’re eligible for Social Security (but it’s reduced 30% from your full benefit).
- Turned 65: Medicare enrollment. Make sure you signed up during the initial enrollment window to avoid late penalties.
- Turned 73 (or 75 if born 1960+): Required minimum distributions from traditional IRAs and 401(k)s begin. You must take your first RMD by April 1 of the year after you turn 73/75, but that doubles up your taxable income in year two. Taking it in the first year is usually smarter.
Max Out Retirement Contributions
December 31 is the deadline for 401(k) employee deferrals. Make sure your last paycheck of the year includes enough to hit your target. IRA contributions can be made until the tax filing deadline (typically April 15), but why wait?
Take Your RMD
If you’re 73 or older (75+ for those born 1960 or later), make sure your required minimum distribution has been taken before December 31. The penalty for missing an RMD is 25% of the amount you should have withdrawn (reduced from 50% under SECURE 2.0). If you correct it within two years, the penalty drops to 10%.
Consider a qualified charitable distribution (QCD) if you’re 70 and a half or older. You can donate up to $105,000 directly from your IRA to charity. It counts toward your RMD but isn’t included in taxable income.
Harvest Tax Losses
Review your taxable accounts for investments that are down. Selling them locks in the loss, which offsets capital gains and up to $3,000 of ordinary income per year. Unused losses carry forward indefinitely. Just watch the wash-sale rule: don’t buy a “substantially identical” investment within 30 days.
Review Beneficiaries
Life changes happen. Make sure the right people are listed on your retirement accounts, life insurance, and bank accounts. Beneficiary designations override your will.
Use Flexible Spending Account (FSA) Funds
Most FSAs are use-it-or-lose-it by December 31 (some plans offer a grace period or $640 carryover). Schedule that dental cleaning, buy new glasses, or stock up on eligible medical supplies before the deadline.
FAQ
What’s the deadline for 401(k) employer contributions?
Employer contributions (match, profit sharing) can be made until the business tax filing deadline, including extensions. Employee deferrals must come from paychecks received by December 31.
Should I do a Roth conversion before year-end?
Possibly. If your income is lower than usual this year, converting some traditional IRA funds to a Roth at a lower tax rate can save money long-term. Run the numbers with your advisor before December 31.
Schedule a free 20-minute consultation to review your year-end financial checklist.
R.L. Brown Wealth Management
106 W Vine St, Suite 300, Lexington, KY 40507
859.317.5889
