Closing 2025 While Bracing for 2026

As we move through March, most of the focus is on the rearview mirror—gathering 1099s and finalizing 2025 returns. However, for the proactive investor, this month isn't just about filing; it’s about execution.

There are two distinct "windows" open right now. One closes on April 15, and the other is just beginning to take shape as new tax laws from the One Big Beautiful Bill (OBBB) take full effect.

The "Final Call" Window (Deadline: April 15, 2026)

Before you send off that 2025 return, ensure you’ve maximized the "last-minute" levers still available to you:

• IRA & HSA Contributions: You have until April 15 to make contributions for the 2025 tax year. For 2025, the limit is $7,000 ($8,000 if you’re 50+). For an HSA, it’s $4,300 for individuals or $8,550 for families.

• The New "Senior Deduction": If you were 65 or older by the end of 2025, you may qualify for a significant new federal deduction—up to $6,000 for individuals or $12,000 for joint filers—thanks to recent legislative changes.

• Funding the Gap: If you find yourself owing more than expected, now is the time to review your "asset location"—ensuring your most tax-efficient investments are in the right types of accounts to prevent a repeat next year.

  
  

Looking Forward: 2026 Planning Shifts

While we finish the 2025 tax year, the 2026 tax year has already begun, and the rules of the game have shifted:

• Higher Contribution Ceilings: The 401(k) elective deferral limit has jumped to $24,500 for 2026. If you are between ages 60 and 63, a new "Super Catch-up" provision may allow you to contribute up to $11,250 in addition to the base limit.

• Standard Deduction Increases: The standard deduction for married couples filing jointly has risen to $32,200 for 2026. This makes the "bunching" of charitable contributions or medical expenses even more critical to exceeding that higher threshold.

• Roth Transition for High Earners: Be aware that starting in 2026, new rules require catch-up contributions for high earners (those making over $160k) to be made into Roth accounts rather than pre-tax. This requires a shift in how you project your future tax brackets.

  
  

The Bottom Line

Tax planning is not a once-a-year event; it is a year-round discipline. The goal is to move from being a "tax reporter" to a "tax strategist."

Are you confident that your current portfolio is optimized for these new 2026 limits? If you’d like to run a "Tax Stress Test" on your current plan before the April deadline, let’s schedule a time to talk.