1. Manage Required Minimum Distributions (RMDs) Intentionally

If you are age 73 or older—or inherited a retirement account—you must take your RMD before year-end to avoid penalties. If you don’t need the income for living expenses, explore strategies that reduce taxes or support long-term planning goals.

Key Move: Meet with your advisor to determine the most tax-efficient way to take or allocate your RMDs, especially if you are also planning Roth conversions or managing taxable income thresholds.

2. Evaluate Whether a Roth IRA Conversion Makes Sense in 2025

A Roth conversion allows you to move pre-tax retirement assets into a Roth account in exchange for paying taxes now. This can be advantageous if:

• • You expect tax rates to increase
• • Your income is unusually low this year
• • You want to reduce future RMDs
• • You plan to retire or relocate to a higher-tax state
•  

Planning Tip: Coordinate with your tax professional to determine how much you can convert without pushing yourself into a higher tax bracket.

3. Review Beneficiary Designations Across All Accounts

Beneficiary designations override your will, which means failing to update them can result in unintended heirs or costly disputes.

Review beneficiaries on:

• • IRAs and 401(k)s
• • Life insurance policies
• • Annuities
• • Bank and brokerage accounts with TOD/POD designations
•  

Why This Matters: Under the SECURE Act, most non-spouse heirs must empty inherited retirement accounts within 10 years—making beneficiary planning more important than ever.

4. Revisit Your Estate Plan Before 2026

The lifetime estate and gift tax exemption is expected to increase to $15 million per individual in 2026, indexed to inflation. This shift reduces the urgency to make very large gifts in 2025 but makes it essential to review your existing documents.

Consider:

• • Whether your will and trust reflect current law
• • Annual exclusion gifts ($19,000 per recipient in 2025)
• • Direct tuition or medical payments for loved ones
• • Whether to hold or gift highly appreciated assets
•  

Planning Consideration: Remember that assets passed at death receive a step-up in basis, while lifetime gifts do not. This dramatically affects tax outcomes for your heirs.

5. Take Advantage of Planning Opportunities in a Lower Interest Rate Environment

Interest rate movements directly impact several sophisticated estate planning strategies.

Intra-Family Loans

When the Applicable Federal Rate (AFR) is low, intra-family loans can be an efficient way to transfer future appreciation out of your taxable estate.

Grantor Retained Annuity Trusts (GRATs)

GRATs become more powerful as interest rates fall, because trust assets are more likely to outperform the Section 7520 rate, allowing more tax-free appreciation to pass to heirs.

Planning Tip: If rates decline in 2025 or 2026, consider refinancing older GRATs to improve long-term transfer efficiency.

6. Complete Key Year-End Trust Administration Tasks

Trusts often require specific actions before year-end to preserve tax benefits and maintain compliance.

Important Steps:

• • Send Crummey notices for irrevocable trusts using annual exclusion gifts
• • Evaluate income distributions from non-grantor trusts
• • Assess whether the trust or beneficiaries will be taxed more efficiently
•  

Planning Tip: The 65-Day Rule Trustees have until March 5, 2026 (65 days after year-end) to make distributions that count as 2025 income distributions for tax purposes.

7. Optimize Education & Healthcare Savings (529, HSA, FSA Combined)

529 College Savings Plans.

Even though Florida has no state income tax, 529 plans still offer federal tax advantages and powerful legacy-planning opportunities.

• • Consider superfunding up to $190,000 for each beneficiary using the 5-year election.
• • Grandparent-owned 529s do not count against FAFSA calculations.
•  

Health Savings Accounts (HSAs).

HSAs offer triple tax benefits—deductible contributions, tax-free growth, and tax-free withdrawals for qualified medical expenses.

2025 limits:

• • $4,300 (individual)
• • $8,550 (family)
• • $1,000 catch-up per spouse (55+)
•  

New eligibility options begin in 2026, expanding access for many taxpayers.

Flexible Spending Accounts (FSAs)

Remember: most FSA funds are use-it-or-lose-it, making year-end planning essential.

Planning Tip: You can strategically use HSA and FSA contributions to reduce taxable income while planning for healthcare and education-related expenses.

8. Execute Year-End Income Tax Planning

High-net-worth families should review potential tax strategies such as:

• • Accelerating deductible expenses
• • Deferring income into 2026
• • Evaluating capital gains and losses
• • Reviewing exposure to the Net Investment Income Tax (NIIT)
•  

The Temporary SALT Cap Increase

For 2025, the SALT deduction cap increases from $10,000 to $40,000 for those earning $500,000 or less. Above that, the cap phases down.

Planning Tip: Business owners or professionals with control over income timing may want to defer income into 2026 to maximize the 2025 SALT benefit.

9. Assess Your Exposure to the Alternative Minimum Tax (AMT)

Households earning between $400,000 and $600,000—or those exercising incentive stock options—are most likely to trigger AMT.

2025 AMT exemptions:

• • $137,000 (married filing jointly)
• • $88,100 (single)

Exemptions begin phasing out at $1,252,700 for couples and $626,350 for singles.

Planning Tip: If you hold incentive stock options, consider exercising across multiple tax years to avoid large AMT liabilities.

10. Review Investment Allocations and Tax-Efficiency Before Year-End

Markets have fluctuated significantly over the last few years, making year-end a good time to:

• • Rebalance portfolios
• • Realize capital gains or losses strategically
• • Review concentrated stock positions
• • Assess whether asset location (taxable vs. tax-deferred accounts) is optimized
• • Align investments with your estate planning goals
•  

Planning Tip: Pairing investment management with estate tax planning—especially ahead of 2026’s exemption changes—can increase both tax efficiency and long-term wealth preservation.

Final Thoughts: Make 2025 Count Before Major Tax Law Changes Arrive

The window between now and December 31, 2025 is an opportunity to take advantage of favorable tax rules before sweeping changes take effect in 2026. Whether your goals include reducing taxes, optimizing retirement income, protecting your estate, or transferring wealth strategically, these 10 strategies help position you for long-term success.