Commentary · Tax Strategy
Year-End Tax Planning Needs a Head Start
Written by the William Allan team · Published
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Year-end tax planning has a reputation it has not earned.
The reputation is that it happens in December. The year is almost over. Someone sends a checklist. A few trades get made in the last week, a check gets written on the 30th, and the household feels like it did the responsible thing.
The calendar is not the problem. The lead time is.
Several moves that can change a tax year need days, and sometimes weeks, to complete cleanly. A loss sale needs a review of purchases around it. A gift of appreciated shares needs a completed transfer. A direct Roth conversion needs custodian processing. A payroll contribution change needs the right paycheck. Many year-end moves can still be completed in December, but the deadline and the time needed to meet it are different questions.
Waiting until the last week is how people either miss the move or make a messy version of it.
What This Year Actually Looks Like
The useful starting point is not last year’s return. It is this year, the one you are still in.
What has already happened. A sale. A bonus. A vest. A conversion. A distribution you did not need but took anyway. What is still going to happen, whether you plan it or not. A K-1. Another vest. A required withdrawal. A year-end bonus that lands in December and shows up on a return you thought was already done.
You do not need a precise forecast of the market to see the shape of the year. You need a picture of the income that is already in motion.
Households that skip this step do not skip it because they are careless. They skip it because nothing is forcing the conversation yet. April is far away. December still sounds like plenty of time. Then December arrives, the custodian is slow, payroll has already run, and the year is the year.
The Moves That Need Calendar
Tax-loss harvesting is the one people remember. You sell something that is below what you paid, and the loss can offset gains you have already taken, or gains you are about to take. That part is simple. The part that needs care is the rule that generally disallows the loss if you buy the same, or a substantially identical, security within 30 days before or after the sale. The IRS calls it a wash sale. The practical effect is that the purchase review for a December loss sale can extend into January. Crossing into a new tax year does not reset that window; purchases in other accounts can matter too.
Starting in September or October gives you more time to review transactions and choose an appropriate replacement. A December harvest can still work. The same wash-sale rules apply whenever the sale occurs.
Charitable gifts deserve lead time for a different reason. Cash gifts can often move quickly, while transfers of appreciated shares may require more coordination with the custodian and recipient. Confirm how and when the gift will be completed for tax purposes. A late-December transfer may succeed, but it leaves less room to resolve missing instructions or processing delays.
Roth conversions belong on the same list. Arrange a direct conversion early enough for the custodian to process the distribution in the intended tax year. An eligible indirect rollover has a separate 60-day deadline and can cross year-end; its taxable amount generally belongs to the distribution year. Confirm the method and reporting with your tax professional. Our article about the conversion window covers the broader decision. The point here is the clock: a conversion you decide on December 28 may not be processed when you expect. The IRS conversion guidance explains the available methods.
Payroll deferrals and workplace contributions need a cycle. If the plan has to see the election on a paycheck that has not been processed yet, the last pay period of the year is not a planning session. It is a leftover.
The Questions That Actually Decide It
What does this year’s income look like without any further moves. Not a guess. The year you are in.
What has already created a gain, a loss, or a lump of ordinary income. Vesting, a sale, a conversion, a distribution.
Whether any of those are still sitting in cash, or already spent, or already earmarked for something else.
Whether you give, and whether you give from cash or from a position that has grown.
Whether you pay estimated taxes, and whether the remaining payments still match the year you are actually having. As of this article’s August 2026 publication, the next installment for most calendar-year individual taxpayers is due September 15, 2026. The 2026 Form 1040-ES instructions list the federal schedule; special rules and disaster postponements can change a deadline.
If you cannot answer those yet, you are not behind. You are in the position most households are in at the end of August. The difference is that August still has a fall attached to it.
What We Would Tell a Friend
If a friend asked over dinner, without the software, the honest answer would go something like this.
If you do not know what this year looks like yet, start there. Not with a strategy. With a picture. Most of the useful decisions get easier once the year is visible.
If this year has already been loud, a sale, a vest, a conversion, a distribution, December is not when you want to find that out. The remaining months are for deciding whether anything else should happen, not for discovering the thing that already did.
If this year has been quiet, that is information too. Quiet years are often the ones where a harvest, a gift, or a conversion has room. Loud years are often the ones where the right move is to stop adding.
And if you have been telling yourself you will deal with it in December, start by checking the actual deadlines and processing times. Some decisions can wait. Others benefit from work now. Knowing which is which is the point.
Bring that picture to the professionals helping with your financial and tax planning. The time needed to evaluate it will depend on your circumstances and the information available.
Schedule a free first call with Ian. He will gather your situation and connect you with the appropriate advisor.
Informational purposes only. Not investment, tax, or legal advice. Tax-loss harvesting, charitable gifts, retirement contributions, and Roth conversions depend on individual circumstances, account type, and current law, which can change. Wash-sale rules may disallow a loss if a substantially identical security is purchased within a defined window before or after the sale. Deadlines and processing times vary by custodian and employer plan. William Allan does not provide tax advice. Consult a qualified tax professional regarding your situation. William Allan is an investment adviser registered with the SEC; registration does not imply any specific level of skill or training. All investing involves risk, including possible loss of principal.