Beat the Tax Bite With These Three Strategic Moves Before December Ends

Your tax bill doesn’t have to be an unwelcome surprise this April. Whether you pocketed a severance, inherited cash, or simply earned more than anticipated, financial advisors say a few strategic December moves can save you hundreds of dollars that might otherwise flow to the IRS. The clock’s ticking, but three powerful tactics remain on the table.

• Maxing out retirement contributions offers quick tax relief, with employees able to defer $23.5K — or $31K for those 50 and older, while solo 401(k) business owners can shelter up to $70K.
• Retirees over 70.5 years can also use qualified charitable distributions of up to $108K from traditional IRAs to satisfy required minimum distributions without triggering taxable income.

Squaring up: Tax-loss harvesting is another smart option. Selling underperformers can offset capital gains, and if losses exceed gains, you can apply $3K against ordinary income while carrying the rest forward indefinitely. Just avoid the wash-sale rule by waiting 30 days before buying back the same or similar securities. As financial planner Mari Adam puts it, paying taxes when you have losses available to offset them is “kind of foolish,” and year-end is the last chance to fix that.