Don’t Let December Sneak Up on Your Taxes

Don’t Let December Sneak Up on Your Taxes

December is when a lot of people start thinking about the holidays, year-end bonuses, and making it through the final stretch of the year.

But if you’re serious about your financial plan, December should also be a time to look at your taxes.

The biggest mistake I see is waiting until tax season to think about taxes. By the time you’re filing your return in April, most of the opportunities to make meaningful planning decisions for the previous year are already gone.

Tax planning happens before December 31—not after it.

There are several areas worth reviewing before the calendar turns:

Roth conversions. If you have money in a traditional IRA or 401(k), a year with lower-than-normal income may create an opportunity to convert some assets to a Roth IRA. Paying taxes today can potentially reduce future tax exposure, particularly if you expect your income or tax rates to be higher later.

Charitable giving. If you are already planning to give to charity, consider whether there is a more tax-efficient way to do it. Qualified charitable distributions (QCDs), appreciated securities, donor-advised funds, and other strategies can produce very different tax outcomes depending on your situation.

Required minimum distributions. If you’re subject to RMDs, make sure you’ve taken the appropriate distribution before year-end. For charitably inclined retirees, a QCD may allow an IRA distribution to support a charity while potentially providing a more favorable tax result.

Capital gains and losses. Your investment portfolio isn’t just about what you made this year. Unrealized gains and losses can create opportunities for tax-loss harvesting, gain management, and portfolio rebalancing. Your investment decisions and tax decisions shouldn’t happen in separate rooms.

Retirement contributions. Review whether you’ve taken advantage of available 401(k), IRA, HSA, or other tax-advantaged accounts. Depending on the account and contribution type, the deadline may not actually be December 31, but it’s still important to identify opportunities before the year closes.

And don’t forget about the next year.

A large bonus, business income, retirement, sale of a property, inheritance, or other major financial event could dramatically change your tax picture. Sometimes the most valuable tax strategy isn’t what you do today—it’s what you decide to do before a major financial event occurs.

This is why I believe tax planning should be part of your financial plan throughout the year, not something you hand to your CPA once a year.

Your investments, retirement income, charitable giving, estate plan, and taxes are all connected.

Before December 31, take a step back and ask a simple question:

“What financial decisions can I still make this year that could improve my tax situation?”

You don’t have to be a tax expert to ask the question. But you do need to ask it early enough to do something about the answer.

At Lloyd Financial Group, we believe financial planning isn’t simply about building a portfolio. It’s about looking at the entire picture and helping you make smarter decisions with your money.

Don’t let December sneak up on your taxes. Plan now, so you can finish the year with confidence—and Dream Bigger, Sleep Better.

Click here to schedule a meeting — I’m here to help you take the next step toward financial freedom.

Colin Symons, CIO Lloyd Financial Group

The FOMC Minutes weren’t overly exciting, as usual. Arguably, they weren’t overly hawkish, with most participants talking about just one more hike this year. A December hike is viewed as the most likely outcome.

Iran deal hopes faded again, with more talk of resuming attacks. This has oil up 4% and hit bonds.

The 10Y auction did very well, with a good size of indirect bidders.

Fed head Waller was a bit hawkish overnight, saying oil prices could stay elevated, though he also said there’s no need for consecutive hikes.

Applied Digital (APLD) is up 4% after topping estimates.

Taiwan Semi (TSM) saw revenue up 55% Y/Y to a new record but is -1%.

Samsung reported a roughly ninefold increase in earnings Y/Y, but that was actually slightly short of expectations, leaving shares -2%.

Jobless Claims and a 30Y bond auction today.

Bottom Line: The Middle East is causing tension again, hitting oil and bonds.

Click here to schedule a meeting — I’m here to help you take the next step toward financial freedom.

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