Tax planning isn’t something that should only happen during tax season. In fact, the middle of the year is one of the best times to evaluate your financial situation and make adjustments that could lower your tax liability before December 31.
With several tax law changes now in effect, including provisions from the One Big Beautiful Bill Act (OBBBA), taking a proactive approach can make a significant difference. Here are several tax planning opportunities to discuss with your tax advisor before year-end.
1. Review Your Tax Bracket
- Increasing retirement contributions
- Deferring income into a future year
- Accelerating deductible expenses
- Planning capital gains or losses
Knowing your expected tax bracket before year-end can help you make more informed financial decisions.
2. Determine Whether Itemizing Makes Sense
- State and local taxes (SALT)
- Property taxes
- Mortgage interest
- Charitable contributions
- Medical expenses
If your deductions are close to the standard deduction, strategically timing certain expenses before year-end could allow you to maximize your tax benefit.
It’s also important to remember that the higher SALT deduction limits currently available may make itemizing more beneficial for some taxpayers.
3. Accelerate Deductible Expenses
If you expect to itemize this year, consider whether it makes sense to accelerate deductible expenses into 2026.
Potential opportunities include:
- Prepaying your January mortgage payment
- Paying property taxes due early next year
- Making charitable contributions before December 31
- Scheduling deductible medical, dental, or vision procedures before year-end
These strategies won’t benefit everyone, but they can provide meaningful tax savings when used appropriately. Always consult your tax advisor before making large prepayments.
4. Review Your Investment Portfolio
Midyear is also an excellent time to evaluate your investment gains and losses.
If you’ve realized gains during the year—or expect to before year-end—you may benefit from tax-loss harvesting. Selling investments that have declined in value can offset taxable capital gains and, in some cases, reduce ordinary income.
Consider reviewing:
- Unrealized gains and losses
- Holding periods for investments
- Long-term versus short-term capital gains
- Carryforward capital losses from prior years
A strategic review now can help prevent unnecessary taxes later.
5. Educators May Qualify for Additional Tax Benefits
Teachers and certain other educators continue to have valuable tax deductions available.
Eligible educators may be able to deduct qualifying classroom expenses, including:
- Books and classroom supplies
- Computer equipment and software
- Professional development costs
- Certain instructional materials
Recent tax law changes have expanded opportunities for some educators, making it worthwhile to keep detailed records of eligible expenses throughout the year.
Don’t Wait Until Tax Season
The most effective tax planning happens before the year ends—not after tax documents begin arriving.
Meeting with your tax advisor now provides time to:
- Estimate your 2026 tax liability
- Evaluate available deductions and credits
- Adjust withholding or estimated tax payments
- Implement year-end tax-saving strategies
- Avoid surprises when it’s time to file
Every taxpayer’s situation is unique, and even small planning opportunities can add up to meaningful tax savings.
Need Help with Midyear Tax Planning?
Our team is here to help you evaluate your current tax situation and identify opportunities that fit your financial goals. Contact our office today to schedule a midyear tax planning consultation and take advantage of strategies that may help reduce your 2026 tax bill.
