What to Add to Your Year-End Tax Planning Checklist

With constantly changing tax laws and the complexities of various deduction phases-outs, it’s more important than ever to have a strategic approach to tax planning before the beginning of a new year. While the task may seem daunting, breaking down the task into key areas can help you maximize tax savings and minimize missed opportunities.

Here are the main areas your year-end tax planning checklist should cover:

1. Income tax planning and timing
2. Investment and capital gains strategy
3. Retirement account optimization
4. Business owner considerations
5. Real estate and property planning
6. Family tax planning
7. Charitable giving strategy
8. Estate planning updates

Before diving into these areas, consider working with a qualified tax advisor from Avidian Wealth Solutions, who can help you tailor these year-end tax strategies to your specific situation. Tax laws are complex and constantly changing — our professional guidance can help you plan to avoid costly mistakes and maximize available benefits.

Follow this link to see our full end of year tax planning checklist

1. Income tax planning and timing

A key consideration here is timing your income recognition strategically. For example, if you’re expecting a large bonus, you might want to negotiate receiving it in December rather than January, depending on your tax situation. With increased IRS enforcement budgets, it’s crucial to maintain detailed records of any timing strategies implemented. Additional considerations include:

• Reviewing withholding levels to avoid underpayment penalties
• Analyzing alternative minimum tax (AMT) exposure
• Bundling deductions when possible to exceed the standard deduction threshold

2. Investment and capital gains strategy

• Harvest tax losses to offset gains
• Review investment holdings for tax-efficient positioning
• Consider the timing of capital gains recognition
• Watch for wash sale rules with cryptocurrency through 2024
• Monitor the impact of Net Investment Income Tax (3.8%) for incomes over $250,000 (married)

One often-overlooked aspect of tax-loss harvesting involves the interplay between different types of investment vehicles and accounts. For example, holding tax-inefficient investments (like high-yield bonds or REITs) in tax-advantaged accounts while keeping more tax-efficient investments (like growth stocks or municipal bonds) in taxable accounts can significantly improve after-tax returns. 

Additionally, consider using specific lot identification when selling investments rather than the default first-in-first-out method, as this can give you more control over the size of capital gains or losses you realize.

3. Retirement account optimization

A sophisticated strategy gaining traction is the “mega backdoor Roth.” If your employer’s 401(k) plan allows after-tax contributions and in-plan Roth conversions, you might be able to contribute significantly more to your retirement savings. This strategy works particularly well for high-income earners who are phased out of traditional Roth IRA contributions and want to maximize tax-free growth potential. Otherwise, you could consider:

• Maxing out 401(k) contributions: $23,000 for 2024 ($30,500 if over 50)
• Roth conversion opportunities in lower-income years
• Taking required minimum distributions (RMDs) if over 73
• Evaluating backdoor Roth IRA strategies
• Considering Qualified Charitable Distributions (QCDs) if over 70½

4. Business owner considerations

• Accelerate expenses or defer income based on tax bracket expectations
• Review Section 199A qualified business deduction optimization
• Consider equipment purchases for Section 179 or bonus depreciation
• Evaluate retirement plan options (Solo 401(k), SEP IRA, Cash Balance Plan)
• Monitor 1% excise tax on stock buybacks for public companies

With remote work on the rise, business owners must watch for state tax nexus issues, as employees in different states can trigger unexpected tax obligations. To help mitigate this, you can establish clear remote work policies and consult a tax professional to navigate these implications in your year-end tax planning for businesses.

5. Real estate and property planning

• Review mortgage interest deduction limitations ($750,000 cap)
• Consider property tax prepayment strategy
• Evaluate 1031 exchange opportunities for investment properties
• Plan for principal residence exclusion requirements

Texas property owners face some of the highest property tax rates in the nation but benefit from having no state income tax. Consider reviewing your property tax exemptions, particularly the homestead exemption which can offer significant protection. For those 65 or older, Texas offers additional property tax benefits including tax ceiling protections. Investment property owners should consider entity structures like Texas Series LLCs for liability protection.

6. Family tax planning

• Review dependency status changes
• Plan for education expenses and 529 contributions
• Consider family gift tax exclusion ($18,000 for 2024)
• Evaluate kiddie tax implications for investment income
• Plan for child tax credit optimization

An innovative tax planning strategy involves leveraging family members’ tax brackets through legitimate business involvement. For example, hiring your children in your business can shift income to their lower tax brackets while teaching valuable skills. 

For children under 18 working in a parent’s unincorporated business, their wages may be exempt from FICA taxes. Additionally, they can contribute to a Roth IRA, potentially starting their retirement savings decades early with tax-free growth.

7. Charitable giving strategy

A sophisticated charitable giving strategy to consider is the use of Charitable Lead Annuity Trusts (CLATs) in low-interest-rate environments. These trusts can provide significant charitable deductions while potentially passing wealth to heirs with minimal gift tax impact. The interest rate environment can make this strategy more or less attractive, as rates affect the potential tax benefits. Other charitable giving strategies to consider include:

• Bundling charitable contributions to exceed the standard deduction
• Considering donor-advised funds (DAFs) for multi-year giving
• Evaluating appreciated stock donations
• Planning Qualified Charitable Distributions from IRAs
• Documenting all charitable contributions properly

8. Estate planning updates

• Review estate tax exemption utilization ($13.61 million for 2024)
• Consider annual gift exclusion opportunities
• Update beneficiary designations
• Review trust strategies for tax efficiency
• Plan for basis step-up opportunities

One advanced technique worth exploring is the use of Spousal Lifetime Access Trusts (SLATs), which allow couples to use their exemptions while maintaining indirect access to gifted assets through their spouse. This can be particularly valuable when estate tax exemptions are high, allowing families to lock in current benefits while maintaining flexibility for the future.

Additional tax planning tips for high-earning families

Creating an end-of-year tax checklist can be complex, and mistakes can be costly. While this guide provides a framework for implementing tax planning strategies, it doesn’t replace working with qualified tax professionals. Together, you can implement supplementary tax planning strategies including:

• Coordinating major life events (marriage, retirement, business sales) with your tax situation
• Projecting income and deductions across multiple years for optimal year-end tax planning for businesses and personal taxes
• Structuring investment accounts for tax efficiency and maintaining detailed tax-loss harvesting records
• Considering multi-generation planning, including strategic gifting and inheritance timing
• Maintaining a coordinated professional team (tax, legal, financial) for comprehensive planning

The most successful implementation of these tax planning tips requires starting well before December 31st. Creating a thorough end-of-year tax checklist and reviewing it quarterly with your advisors can help make sure that no opportunities are missed. Remember that an effective checklist for taxes needs to be personalized to your specific situation while remaining flexible enough to adapt to changing circumstances and regulations.

Learn more: What is tax planning for high-net-worth individuals?

Is your tax plan ready for the new year? With Avidian Wealth Solutions, it will be.

Creating a comprehensive year-end tax planning checklist is essential for high-net-worth families looking to optimize their tax position, but you don’t have to sort through the complexity of these tax strategies, or make tax-related decisions, on your own.

Avidian Wealth Solutions has experience offering sophisticated tax planning for high-net-worth individuals, bringing together a coordinated team of CPAs, financial advisors, and tax strategists under one roof. Our integrated approach means we can implement your tax planning strategies while considering your broader wealth management goals — bridging possible gaps between your retirement tax planning, investment strategy, and estate planning needs. 

Schedule a conversation with us today to optimize your tax strategy for the coming year. With offices in Houston, Austin, Sugar Land, and The Woodlands, we are ready to help you implement a tax-efficient wealth management strategy no matter where you are.

More Helpful Articles by Avidian: 

• How Does Inflation Affect Investments?
• Should You Update Your Estate Plan in 2026?
• Retirement Planning for a Non-Traditional Career
• What to Know About the New 401(k) Catch-Up Contribution Rules
• SALT Tax Deduction Changes and High-Income Earners

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