Last-Minute Tax Strategies Before You File

Before Submitting Your Return, Here Are Some Last-Minute Tax Strategies

Let’s say you’re looking at a tax bill you weren’t expecting. Maybe it’s from a big gain last year, a business sale, or just a year where the numbers came in higher than you planned. And now you’re wondering… is there anything I can still do about it? 

Here’s the reality: yes, there is. But you need to move fast. 

Most people assume that once the calendar year ends, the window for tax planning closes with it. Well, that’s not entirely true. While many strategies do require action before Dec. 31, there are several legitimate moves you can still make between Jan. 1 and your filing deadline that could meaningfully reduce what you owe.  

The key is understanding what’s still on the table and which options actually apply to your situation. 

The Real Deadline 

Let’s start with the most important thing to understand… not all tax planning has to happen during the calendar year. Some of the most effective strategies can be executed right up until your tax return is due, and in certain cases, even later if you file an extension. 

That said, every one of these strategies has a specific deadline. Some are tied to the filing date, and others depend on the date a gain was realized. They all require action, not just awareness. 

This isn’t something to delegate to next year or put on the back burner. Call an Asset Strategy Advisor today to help implement Tax Strategy, (781) 235-4426. 

1) Prior-Year Traditional IRA Contribution 

This is one of the cleanest moves you can make after the year ends. You have until the tax filing deadline (typically April 15) to make a traditional IRA contribution that counts for the prior tax year. No extensions apply to this deadline. If the filing date is April 15, that’s your hard cutoff. 

The deductibility of a traditional IRA contribution is subject to income limits if you or your spouse are covered by an employer-sponsored retirement plan; if neither spouse is covered, the contribution is generally fully deductible regardless of income. If you do qualify, it’s straightforward: make the contribution, claim the deduction, and lower your tax bill. 

Even if the deduction is limited or unavailable due to income, the contribution still grows tax-deferred inside the account. And if a Roth IRA is a better fit for your situation (contributions aren’t deductible, but qualified withdrawals are tax-free), you have the same deadline to fund that as well, subject to income eligibility limits. 

Talk to us about whether a deductible traditional IRA contribution makes sense given your income, filing status, and workplace retirement plan coverage. 

2) Prior-Year HSA Contribution

If you were enrolled in a high-deductible health plan (HDHP) during the prior tax year, you may still be able to contribute to a Health Savings Account (HSA) for that year. Like the IRA, the deadline is the tax filing deadline (typically April 15), and extensions do not push this date out. 

This is one of the most powerful tax tools available because the deduction is above the line. That means it reduces your adjusted gross income directly, which can have a cascading effect on other tax calculations, phase-outs, and credits. You don’t need to itemize to claim it. 

HSA contributions are reported on IRS Form 8889. If you have unused contribution room from the prior year and you were HSA-eligible, this is often one of the best late-season moves available. For 2025, the HSA contribution limits are $4,300 for self-only coverage and $8,550 for family coverage, with an additional $1,000 catch-up contribution allowed for those age 55 or older.

3) SEP-IRA Contribution for Self-Employed Taxpayers

If you’re self-employed or own a small business, the SEP-IRA is one of the most flexible post-year-end planning tools available. Unlike a traditional IRA, the contribution deadline for a SEP-IRA is tied to your business tax return due date, including extensions. 

That means if you file an extension, you could have until October 15 (for sole proprietors and single-member LLCs) or September 15 (for partnerships and S-corporations) to make a prior-year contribution. The contribution limits are significantly higher than a traditional IRA, generally up to 25% of net self-employment income, subject to an annual cap set by the IRS. 

For 2025, SEP-IRA contributions are limited to the lesser of 25% of eligible compensation or $70,000, with compensation taken into account up to $350,000. 

This is a major planning opportunity for business owners who had a strong income year and want to reduce their taxable income. You can even establish a new SEP-IRA and fund it for the prior year, as long as you do so by the return due date (including extensions). 

4) Solo 401(k) Planning for Eligible Self-Employed Taxpayers

If you’re self-employed with no full-time employees (other than a spouse), the solo 401(k) deserves attention. While employee deferrals (the portion that comes from your compensation) must be elected by December 31; the employer contribution side has more flexibility.

Employer contributions to a solo 401(k) can generally be made up to the tax return due date, including extensions. Depending on your plan and eligibility, this could represent a significant deduction. In some cases, the total contribution (employee plus employer portions) can be substantially higher than what a SEP-IRA allows, especially at lower income levels.

For 2025, the employee deferral limit is $23,500 (plus a $7,500 catch-up contribution for those age 50 or older), and total contributions, including employer contributions, can reach up to $70,000 (or $77,500 with catch-up contributions), subject to compensation and plan limits.

If you already have a solo 401(k) in place, check with your advisor on whether you’ve maximized the employer contribution for the prior year. If you don’t have one yet, note that the plan generally must have been established by December 31 of the tax year in question to make employee deferrals for that year, though rules around employer contributions and plan adoption can vary. Talk to your advisor about your specific facts.

5) Qualified Opportunity Fund Investment to Defer Capital Gains

If you realized a capital gain late in the prior year, you may still have time to defer that gain by investing in a Qualified Opportunity Fund. The deadline isn’t tied to your filing date. It’s tied to the 180-day period that begins on the date the gain was realized. 

That means a taxpayer who sold an asset in October, November, or December may still be well within the 180-day window when tax season arrives. This is especially relevant for large gains from stock sales, business dispositions, real estate transactions, or gains allocated through a partnership or S-corporation on a Schedule K-1. 

For pass-through entity gains, the 180-day investment period can begin on different dates depending on the election made. If the gain is recognized during 2025, the default 180-day period begins on the date of the sale. Alternatively, a taxpayer may elect to start the 180-day period on the last day of the entity’s tax year (December 31, 2025), which would extend the deadline to June 29, 2026. In many cases, because gain information is reported on a Schedule K-1, taxpayers effectively have additional time to act, often aligning planning decisions closer to the entity’s filing deadline (March 15, 2026), which is 180 days before September 11, 2026, though the formal 180-day period is still tied to the permitted start-date elections. 

The core benefit: if you invest the gain into a Qualified Opportunity Fund within 180 days, you defer federal tax on that gain. And if you hold the QOF investment for at least 10 years, any appreciation on the QOF investment itself can be permanently excluded from federal income tax! 

The rules around Opportunity Zones have evolved since the program launched, including changes under recent legislation that extended and modified the program starting in 2027. The specifics around deferral periods, basis adjustments, and new vs. legacy investments depend on when the gain was realized and when the investment is made. This is not a do-it-yourself strategy. Call us to work with an advisor who is current on the latest rules.

6) Verify Capital Loss Carryforwards Are Being Used

This one isn’t a new deduction, but it’s a step that gets overlooked more often than it should. 

If you had net capital losses in prior years that exceeded what you could deduct (losses can only offset gains, plus up to $3,000 per year against ordinary income), those unused losses should be carrying forward on your return. They flow through Schedule D and can offset current-year capital gains dollar for dollar. 

Before you file, make sure those carryforwards are actually reflected on your return. If you switched tax preparers, changed software, or had a complicated prior-year situation, it’s worth double-checking that nothing fell through the cracks. A missed carryforward is essentially a lost deduction. 

7) Re-Test Standard Deduction vs. Itemizing

This isn’t a new strategy, but it’s one of the most important checks to run before you file. 

Under current law, the standard deduction is relatively high, which means many taxpayers are better off taking it rather than itemizing. But not always. If you had significant mortgage interest, state and local taxes (up to the SALT cap), charitable contributions, or medical expenses during the year, itemizing could save you more. 

The IRS reports itemized deductions on Schedule A (Form 1040). Before you finalize your return, run the numbers both ways. Make sure you’re using whichever method produces the lower tax bill. 

If you made charitable contributions during the prior year, this is the time to make sure every qualifying donation is actually reflected on your return. Gather all receipts and acknowledgment letters. For gifts of $250 or more, you need a written acknowledgment from the 501(c)(3) charity in hand before you file. Confirm each donee is a qualified organization. If you donated appreciated property, make sure Form 8283 is completed as required. 

The deduction itself had to be contributed during the calendar year. You can’t make a new charitable gift now and apply it to last year. But you can make sure you’re not leaving money on the table by failing to include gifts you already made.

8) Correct Excess IRA, HSA, or Retirement Plan Contributions

This is more about penalty prevention than tax reduction, but it can materially improve your outcome before the return is finalized. 

If you contributed more than the allowable limit to an IRA, HSA, or other retirement account during the prior year, you generally have until the tax filing deadline (including extensions, in some cases) to withdraw the excess and any earnings attributable to it. If you don’t correct the excess in time, you face a 6% excise tax on the excess amount for each year it remains in the account. 

This is especially worth checking if your income fluctuated during the year, if you changed jobs, or if you contributed to multiple retirement accounts. A quick review now can prevent an ongoing penalty.

Which Last-Minute Tax Strategies Actually Work for You?

Look, there’s no magic solution that works for everyone. Some of these strategies apply to your situation. Others don’t. Some could save you real money. Others might not move the needle. 

The difference between a really effective tax strategy and a mediocre one is this: it has to match your actual situation. 

Your income. Your assets. Your business structure. Your retirement plan coverage. Your filing status. Your goals. All of it matters. What’s brilliant for one taxpayer might be irrelevant for another. 

That’s why the best next step isn’t to try to implement something yourself based on an article you read. It’s to have a real conversation with someone who understands your full picture. 

Before you file, it may be worth a quick conversation to determine whether any of these strategies are actionable in your situation. At Asset Strategy, we focus on implementation, helping clients evaluate opportunities like retirement plan contributions, Qualified Opportunity Fund investments, and other tax-aware strategies that need to be executed before deadlines pass. 

If you’re considering one of these moves and want clarity on next steps, timing, or setup, our team can help you evaluate whether it makes sense and how to put it in place. 

Don’t file blindly. Don’t assume the year-end was your last chance. And don’t leave money on the table just because you didn’t take 15 minutes to have a conversation about what you can still do before you file. 

Your future self will thank you!