Year-End Tax Planning Tips to Maximize Your Savings At SWBC Wealth Management, we believe proactive planning is the key to financial confidence. As the year wraps up, your advisor has the ability to r...
Financial Planning
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Your Year-End Tax Playbook: 5 Smart Moves to Save Big
Year-End Tax Planning Tips to Maximize Your Savings
At SWBC Wealth Management, we believe proactive planning is the key to financial confidence. As the year wraps up, your advisor has the ability to review your tax return(s) and identify opportunities to reduce your lifetime liability, while positioning you for success in the new year. Here are some practical steps you can take before December 31:
1. Max Out Retirement Contributions
Contributing to tax-advantaged accounts is one of the most effective ways to lower your taxable income while building your future nest egg. For 2025, the IRS contribution limits are:
- 401(k): $23,000 (plus an additional $7,500 if you’re age 50 or older)
- Traditional and Roth IRA: $7,000 (plus $1,000 catch-up for those 50+)
Example: If you’re in the 24% tax bracket and contribute an extra $5,000 to your 401(k), you could reduce your tax bill by $1,200. That’s money you keep working for you instead of going to the IRS.
2. Review Capital Gains and Losses
If you’ve sold profitable investments this year, consider tax-loss harvesting—selling underperforming assets to offset gains. You can deduct up to $3,000 of net capital losses against ordinary income each year, and any excess can be carried forward.
Example: If you realized $10,000 in gains but have $8,000 in unrealized losses, harvesting those losses could reduce your taxable gains to just $2,000. Just remember to watch out for the “wash sale” rule!
3. Charitable Giving
Donations to qualified charities can provide valuable tax deductions. Make contributions before December 31 to claim them for 2025. Keep in mind that starting in 2026, the OBBBA (Opportunity for Better Balanced Budget Act) changes will tighten rules on charitable deductions, especially for non-cash contributions. This means 2025 is an excellent year to maximize your giving under current rules.
Tip: Consider donating appreciated securities instead of cash—you’ll avoid capital gains tax and still receive a charitable deduction.
4. Use Flexible Spending Accounts (FSAs)
If you have an FSA, check your balance and use any remaining funds before year-end. Eligible expenses include medical, dental, and vision costs. Some plans offer a grace period, but many are “use it or lose it.”
5. Evaluate Withholding and Estimated Payments
Major life changes—such as marriage, a new job, or starting a business—can affect your tax situation. Review your withholding and estimated tax payments to avoid surprises when filing your return.
Important Deadlines
- December 31, 2025: Deadline for most year-end contributions and charitable donations.
- April 15, 2026: Tax filing deadline for 2025 returns (and IRA contributions for 2025).
Ready to Make the Most of These Strategies?
Year-end tax planning can feel overwhelming, but you don’t have to navigate it alone. Our wealth advisors can help you create a personalized tax strategy that aligns with your financial goals and takes advantage of every opportunity available to you.
Contact us today to start planning for a stronger financial future!
Securities offered by SWBC Investment Services, LLC, member SIPC & FINRA. Advisory services offered by SWBC Investment Company, a Registered Investment Advisor.
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Financial PlanningMike Walters
Mike Walters joined the Wealth Management team at SWBC in August 2024 after working in the financial services industry in the San Antonio / New Braunfels area for the previous 7 years. Mike is a graduate of Texas State University with a Bachelor of Business Administration in Management and a proud member of the Beta Gamma Sigma honor society and the Financial Planning Association (FPA). Mike is a dedicated CERTIFIED FINANCIAL PLANNER® (CFP®), after earning the prestigious designation in December 2023. With a passion for holistic and comprehensive financial planning, Mike strives to help clients not only achieve their financial goals but truly understand the strategies behind them. Believing that knowledge is power, Mike makes client education a priority, ensuring every individual feels confident and informed while being guided throughout their financial journey. Motivated by a “give to get” philosophy, Mike is committed to delivering exceptional client service, building strong, lasting relationships founded on trust and mutual understanding. A self-professed lifetime learner, Mike is always seeking out new insights and strategies to provide even greater value to clients, ensuring they are well-equipped to navigate the complexities of today’s financial landscape.
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