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One of the fastest ways to cut your taxable income before year-end is to raise the amount you’re contributing to a pre-tax retirement plan such as a 401(k), 403(b), or most 457 plans. Because these contributions are made before income tax is taken out, every extra dollar you defer can reduce your taxable income for the year (up to IRS limits).

For the 2025 tax year, workers can generally contribute up to $23,500 in employee salary deferrals to a 401(k), 403(b), or most 457 plans. If you’re age 50 or older, you may be able to add an extra $7,500 in “catch-up” contributions, for a potential total of $31,000 in employee contributions, subject to plan rules and compensation limits.

• Action step: Log into your employer’s benefits portal or talk with HR and see if you can temporarily increase your contribution rate for your remaining paychecks this year.
• Think in paychecks, not the full year: Even raising your contribution by a few percentage points for your last couple of pay periods can lower your taxable wages.
• Watch employer match rules: Some plans match per paycheck, not annually. If you front-load contributions too aggressively, you might unintentionally miss out on part of the match later in the year.
• Traditional vs. Roth: Only traditional pre-tax contributions reduce this year’s taxable income. Roth 401(k) contributions are after-tax, so they don’t lower this year’s tax bill (though they can offer tax-free withdrawals later, if rules are met).

If you’re still working — even part-time — and have access to a plan, this is usually one of the simplest year-end moves to make. The key is to act before your employer’s payroll cutoff for the last pay period of the year.

If you already give to charity, timing and structure can make a big difference at tax time. Charitable gifts made by December 31 can count for the current tax year if you itemize deductions.

For 2025, the standard deduction is $15,750 for single filers and $31,500 for married couples filing jointly (with different amounts for heads of household). That means your charitable deductions (plus things like mortgage interest, state and local taxes within limits, and certain medical expenses) need to exceed those amounts before itemizing would provide a tax benefit.

• “Bunch” your giving: If you’re close to the standard deduction threshold, consider bunching several years of giving into this year so your total itemized deductions exceed the standard deduction.
• Consider appreciated investments: Donating shares of stock, mutual funds, or ETFs you’ve held more than one year can let you avoid capital gains tax on the appreciation while still potentially deducting the full fair-market value (if you itemize and meet the rules).
• Explore donor-advised funds (DAFs): A DAF allows you to make one large, potentially deductible contribution this year, then recommend grants to charities over time. This can be a powerful tool for “bunching” donations while giving yourself flexibility.
• For retirees with IRAs: If you are at least 70½ and have a traditional IRA, talk to your tax professional about Qualified Charitable Distributions (QCDs). QCDs let money go directly from your IRA to a qualified charity, and the amount given can potentially be excluded from your taxable income (up to annual IRS limits).

Whatever method you use, make sure to keep good records: receipts, acknowledgment letters, or statements from donor-advised funds and IRA custodians. The IRS can require documentation for charitable deductions, and it’s much easier to gather this as you go, rather than during tax season.

If you have a taxable brokerage account, year-end is a natural time to review your investments for tax-loss harvesting. This strategy involves selling investments that are down in value to realize a loss, which can offset capital gains and, in some cases, even reduce ordinary income.

Under current IRS rules, if your realized capital losses are larger than your capital gains for the year, you can generally use up to $3,000 of net losses (or $1,500 if married filing separately) to reduce ordinary income on your tax return. Any remaining unused loss can usually be carried forward to future years.

• Start with your winners: Look at positions where you’ve taken profits or received capital gain distributions this year. Then see whether selling a losing investment could offset those gains.
• Avoid the “wash sale” rule: If you sell a security at a loss and buy the same or “substantially identical” security within 30 days before or after the sale, the loss is typically disallowed for current tax purposes. Instead, consider a similar but not identical investment to maintain your market exposure.
• Don’t let the tax tail wag the dog: It can be tempting to trade purely for tax reasons, but always consider whether the resulting portfolio still fits your risk tolerance, time horizon, and goals.
• Use this as a chance to rebalance: Year-end is a good time to nudge your portfolio back to its target mix. Selling overweight positions that have done well can both realize gains (which can be paired with losses) and help keep your risk level steady.

Tax-loss harvesting can be powerful, but it’s also technical. If you’re unsure how to implement it, consider working with a financial advisor or tax professional, or using a reputable digital platform that supports this strategy.

Health-related accounts can be easy to overlook during a busy holiday season, but a quick check-in before New Year’s can prevent waste and potentially reduce your taxes.

Health Savings Accounts (HSAs)

If you’re enrolled in a qualifying high-deductible health plan, you may be able to contribute to a Health Savings Account (HSA). HSAs are often called “triple-tax-advantaged” because contributions can be tax-deductible, growth is tax-deferred, and withdrawals for qualified medical expenses are tax-free.

For 2025, HSA contribution limits are generally $4,300 for self-only coverage and $8,550 for family coverage, with an additional $1,000 catch-up available if you’re 55 or older and not enrolled in Medicare. Some providers allow contributions up to the tax-filing deadline, but checking your remaining room before year-end can help you plan cash flow and avoid last-minute scrambles later.

Flexible Spending Accounts (FSAs)

Unlike HSAs, many healthcare FSAs are “use-it-or-lose-it”: money you don’t spend by the end of the plan year can be forfeited. Some employers, however, offer either a carryover of up to a limited amount into the next plan year or a grace period (often 2.5 months, such as until mid-March) to use remaining funds.

• Log into your benefits portal: Check your current FSA balance and confirm whether your plan has a grace period or carryover provision.
• Schedule eligible care: If you still have funds to spend, consider year-end doctor or dentist visits, updated prescriptions, glasses or contacts, or eligible over-the-counter products.
• Review next year’s election: If you consistently end the year with leftover FSA funds, you may want to slightly lower next year’s contribution to avoid waste.

While these health-related accounts may seem small compared to retirement plans or investment accounts, they can quietly add up. Managing them intentionally each year helps you avoid forfeiting money you’ve already set aside and may lower your taxable income in the process.