Year-end: what to do before December 31

Most of a year's taxes are decided before December 31, not in April. After that date, almost all that is left is reporting.

Retirement and donations

Contributions to an employer 401(k) plan must be made within the year. Charitable donations also count only if paid before December 31, and you need to keep the receipt. A contribution to a traditional or Roth IRA, by contrast, can be made up to the return due date.

Investment sales

If you sold stock at a gain, check whether you hold positions at a loss. Selling them before year end lets you offset the gain. Be careful about buying the same security back within 30 days, because the loss is then disallowed.

Self-employed and businesses

Check whether your estimated payments are enough; the fourth is due January 15. Ask each contractor for Form W-9 now, not in January. For this year’s payments, Form 1099-NEC is required when total payments to a contractor reach $600, and it is due January 31; starting with 2026 payments, the threshold rises to $2,000.

The new deductions

If you receive tips or overtime, or are 65 or older, keep the documents that support them. The deductions created by the 2025 law depend on those amounts being properly identified.

Life changes

A marriage, a divorce, a child, a move or arriving in the United States changes your return. If any of these happened this year, review it before year end, while there is still room to decide.