5 Year-End Tax Moves Every Pre-Retiree Should Consider Before December 31, 2025
If you’re within five to ten years of retirement, year-end planning can protect more of what you’ve earned. 2025 comes with real deadlines, contribution caps, Required Minimum Distribution (RMD) timing, and Roth conversion windows that close at midnight on December 31. Below, we focus on the moves that tend to matter most.
Why year-end tax planning matters in
2025
401(k) employee deferrals max out at $23,500 this year. Individual Retirement Accounts (IRA) are $7,000 with a $1,000 catch-up for age 50 and over. Ages 60 to 63 may have a special $11,250 catch-up in many employer plans, so check your plan rules. (See the IRS 2025 Retirement Plan Contribution Limits for official details.)
RMDs still begin at age 73 under SECURE 2.0. How and when you take them can affect tax brackets and Medicare means testing.
Qualified Charitable Distributions (QCD) scale with inflation. The cap is $108,000 for 2025.
Many individual tax cuts from the Tax Cuts and Jobs Act (TCJA) are scheduled to expire after 2025. For some households, 2025 may be the final year for today’s lower brackets.
1) Maximize your 2025 retirement contributions
401(k) / 403(b) / 457 / Thrift Savings Plan (TSP): You can defer up to $23,500. The standard age-50+ catch-up is $7,500. If you’re 60 to 63, some plans allow an enhanced $11,250 catch-up, so ask HR or your advisor.
IRAs: The limit is $7,000 plus a $1,000 catch-up for age 50 and over.
Quick tip: Grab your full employer match before anything else. That helps current-year taxes if you use pre-tax deferrals and, more importantly, it’s part of your long-term savings habit. If you’re weighing pre-tax versus Roth contributions, coordinate with your investment management process so your future tax mix fits your broader plan.
2) Harvest losses, carefully, before year-end
If you hold investments below cost, selling them can offset realized gains. You can use up to $3,000 of net losses to offset ordinary income, with the rest carried forward. Be mindful of the wash-sale rule. Buying a “substantially identical” security within 30 days before or after the sale can disallow the loss. One way to keep market exposure is to swap into a different Exchange Traded Fund (ETF) or fund for at least 31 days.
Avoid these mistakes: Re-purchasing the same security inside an IRA or Roth within the 30-day window can still trigger a wash sale, and you won’t get basis credit inside the IRA. That loss is effectively forfeited.
3) Check your RMD math and deadlines
If you turn 73 in 2025, your first RMD is due by April 1, 2026. If you turned 73 in 2024, your 2025 RMD is still due by December 31, 2025. Missed RMDs can mean penalties. It’s smart to coordinate withdrawals with your tax plan and charitable giving, especially if you’re considering QCDs.
4) Consider a Roth conversion before December 31
A partial conversion can “top off” your current bracket and move future growth into a Roth, where qualified withdrawals are tax-free and RMDs don’t apply to the converted dollars. With several TCJA provisions set to sunset after 2025, some households may prefer to pre-pay at today’s rates. Model the effects on income-related monthly adjustment amount (IRMAA) and Net Investment Income Tax (NIIT) before converting.
Catch-up note: The SECURE 2.0 rule that pushes certain high earners’ 401(k) catch-ups into Roth generally starts in 2026, not 2025. Keep that timing in mind as you plan 2025 contributions.
5) Use charitable tools the smart way, QCDs and DAFs
QCDs: If you’re 70½ or older, you can give directly from an IRA to qualified charities, up to $108,000 in 2025. A QCD can satisfy your RMD and may reduce your Adjusted Gross Income (AGI).
Donor-Advised Funds (DAF): You can front-load several years of gifts in a higher-income year. Combining a DAF with appreciated securities can add tax efficiency. Coordinate with your tax professional.
Bonus move: book a 30-minute review
We’ll pull together taxes, investments, cash flow, and estate documents so your 2026 plan starts clean. If you’re near Pittsburgh, Buffalo, or Doylestown, we can meet virtually or in-office. Schedule a consultation
FAQs
What are the 2025 401(k) and IRA limits?
$23,500 for employee 401(k) deferrals and $7,000 for IRAs. Catch-ups are $7,500 for age 50+ in most plans, and a special $11,250 catch-up for ages 60 to 63 where the plan allows.
Do Roth conversions have a deadline?
Yes. Conversions intended for 2025 must be completed by December 31, 2025. IRAs use calendar-year timing. Coordinate with your tax pro.
How do QCDs reduce taxes?
QCDs send IRA dollars straight to charity, which can lower AGI and potentially cover your RMD. The 2025 cap is $108,000.
What changes after 2025?
Many TCJA individual provisions are scheduled to expire after 2025. Brackets and deductions could change. Build flexibility into your plan.
Want a second set of eyes on your year-end plan? Our advisors in Pittsburgh, Buffalo, and Doylestown can help you make smart, coordinated decisions before year-end. Schedule a consultation. For more reading, see more insights on retirement and investing.
Brian Werner is a Managing Partner at Winthrop Partners. He has more than 25 years of experience in investments, financial planning, entrepreneurial ventures, corporate finance, and banking. Prior to joining Winthrop Partners, Brian was the First Vice President and a Senior Wealth Advisor for First Niagara, where he led the development of First Niagara’s Western Pennsylvania Private Client Services and served on its western Pennsylvania operating committee. He also held roles with PNC/National City, Greycourt Investment Advisors, and Linnco Future Group, Chicago Board of Trade. Brian is a Chartered Financial Analyst and Certified Financial Planner. He earned his MBA from Duquesne University, Magna Cum Laude.