Tax Strategies

Year-end tax planning can have a meaningful impact on your after-tax investment returns, yet it's often one of the most overlooked parts of portfolio management. The AAII 2025–2026 Tax Guide: Tax-Planning Strategies for Investors walks through practical steps investors can take before the calendar turns-from timing income and deductions to avoiding underpayment penalties and navigating AMT exposure.

This article focuses on the decisions investors can still control late in the year:

• Whether to accelerate or defer income and deductions

• How to manage capital gains and charitable giving more efficiently

• When AMT rules or safe-harbor requirements can override conventional tax advice

It's part of AAII's broader AAII Annual Tax Guide, which we update each year to help investors understand how changing rules, thresholds and planning strategies fit together across income, investing and retirement decisions.

Which year-end tax move has had the biggest impact for you-timing income, accelerating deductions, or managing capital gains and what typically triggers you to start tax planning each year?

If you haven't already, this article, and the full 2025-2026 Tax Guide, are worth reviewing now, while there's still time to act rather than react. Click here to read.

Merry Christmas! Still a few years from RMDs. Year end work is closing this year's plan to maximize income and minimize taxes. Optimize to hold taxable income to just at the next tax bracket's lower limit. In particular, harvesting long term capital gains at 0% and doing some Roth conversion each year to create sacred money for the long term.

Year-end tax planning can have a meaningful impact on your after-tax investment returns, yet it's often one of the most overlooked parts of portfolio management. The AAII 2025–2026 Tax Guide: Tax-Planning Strategies for Investors walks through practical steps investors can take before the calendar turns-from timing income and deductions to avoiding underpayment penalties and navigating AMT exposure.

This article focuses on the decisions investors can still control late in the year:

• Whether to accelerate or defer income and deductions

• How to manage capital gains and charitable giving more efficiently

• When AMT rules or safe-harbor requirements can override conventional tax advice

It's part of AAII's broader AAII Annual Tax Guide, which we update each year to help investors understand how changing rules, thresholds and planning strategies fit together across income, investing and retirement decisions.

Which year-end tax move has had the biggest impact for you-timing income, accelerating deductions, or managing capital gains and what typically triggers you to start tax planning each year?

If you haven't already, this article, and the full 2025-2026 Tax Guide, are worth reviewing now, while there's still time to act rather than react. Click here to read.

Merry Christmas! Still a few years from RMDs. Year end work is closing this year's plan to maximize income and minimize taxes. Optimize to hold taxable income to just at the next tax bracket's lower limit. In particular, harvesting long term capital gains at 0% and doing some Roth conversion each year to create sacred money for the long term.

Year-end tax planning can have a meaningful impact on your after-tax investment returns, yet it's often one of the most overlooked parts of portfolio management. The AAII 2025–2026 Tax Guide: Tax-Planning Strategies for Investors walks through practical steps investors can take before the calendar turns-from timing income and deductions to avoiding underpayment penalties and navigating AMT exposure.

This article focuses on the decisions investors can still control late in the year:

• Whether to accelerate or defer income and deductions

• How to manage capital gains and charitable giving more efficiently

• When AMT rules or safe-harbor requirements can override conventional tax advice

It's part of AAII's broader AAII Annual Tax Guide, which we update each year to help investors understand how changing rules, thresholds and planning strategies fit together across income, investing and retirement decisions.

Which year-end tax move has had the biggest impact for you-timing income, accelerating deductions, or managing capital gains and what typically triggers you to start tax planning each year?

If you haven't already, this article, and the full 2025-2026 Tax Guide, are worth reviewing now, while there's still time to act rather than react. Click here to read.

Merry Christmas! Still a few years from RMDs. Year end work is closing this year's plan to maximize income and minimize taxes. Optimize to hold taxable income to just at the next tax bracket's lower limit. In particular, harvesting long term capital gains at 0% and doing some Roth conversion each year to create sacred money for the long term.

Year-end tax planning can have a meaningful impact on your after-tax investment returns, yet it's often one of the most overlooked parts of portfolio management. The AAII 2025–2026 Tax Guide: Tax-Planning Strategies for Investors walks through practical steps investors can take before the calendar turns-from timing income and deductions to avoiding underpayment penalties and navigating AMT exposure.

This article focuses on the decisions investors can still control late in the year:

• Whether to accelerate or defer income and deductions

• How to manage capital gains and charitable giving more efficiently

• When AMT rules or safe-harbor requirements can override conventional tax advice

It's part of AAII's broader AAII Annual Tax Guide, which we update each year to help investors understand how changing rules, thresholds and planning strategies fit together across income, investing and retirement decisions.

Which year-end tax move has had the biggest impact for you-timing income, accelerating deductions, or managing capital gains and what typically triggers you to start tax planning each year?

If you haven't already, this article, and the full 2025-2026 Tax Guide, are worth reviewing now, while there's still time to act rather than react. Click here to read.

Merry Christmas! Still a few years from RMDs. Year end work is closing this year's plan to maximize income and minimize taxes. Optimize to hold taxable income to just at the next tax bracket's lower limit. In particular, harvesting long term capital gains at 0% and doing some Roth conversion each year to create sacred money for the long term.

Year-end tax planning can have a meaningful impact on your after-tax investment returns, yet it's often one of the most overlooked parts of portfolio management. The AAII 2025–2026 Tax Guide: Tax-Planning Strategies for Investors walks through practical steps investors can take before the calendar turns-from timing income and deductions to avoiding underpayment penalties and navigating AMT exposure.

This article focuses on the decisions investors can still control late in the year:

• Whether to accelerate or defer income and deductions

• How to manage capital gains and charitable giving more efficiently

• When AMT rules or safe-harbor requirements can override conventional tax advice

It's part of AAII's broader AAII Annual Tax Guide, which we update each year to help investors understand how changing rules, thresholds and planning strategies fit together across income, investing and retirement decisions.

Which year-end tax move has had the biggest impact for you-timing income, accelerating deductions, or managing capital gains and what typically triggers you to start tax planning each year?

If you haven't already, this article, and the full 2025-2026 Tax Guide, are worth reviewing now, while there's still time to act rather than react. Click here to read.

Young people take note! Invest in ROTH assets while you're young! If your 401k or other retirement plan has a Roth option, USE IT!

A Roth IRA is vastly superior to the traditional version because of its enhanced flexibility. The small tax deduction you will receive from contributing to a traditional IRA is not worth the aggravation caused by FORCED, TAXABLE distributions in later years. 

I converted my traditional IRA to a Roth back in 1998, when the government allowed me to spread the associated taxes over four years, and every subsequent IRA contribution I made has been to my Roth. I do not regret missing out on the tiny tax deductions I would have received from contributing to a traditional IRA.

Merry Christmas! Still a few years from RMDs. Year end work is closing this year's plan to maximize income and minimize taxes. Optimize to hold taxable income to just at the next tax bracket's lower limit. In particular, harvesting long term capital gains at 0% and doing some Roth conversion each year to create sacred money for the long term.

Year-end tax planning can have a meaningful impact on your after-tax investment returns, yet it's often one of the most overlooked parts of portfolio management. The AAII 2025–2026 Tax Guide: Tax-Planning Strategies for Investors walks through practical steps investors can take before the calendar turns-from timing income and deductions to avoiding underpayment penalties and navigating AMT exposure.

This article focuses on the decisions investors can still control late in the year:

• Whether to accelerate or defer income and deductions

• How to manage capital gains and charitable giving more efficiently

• When AMT rules or safe-harbor requirements can override conventional tax advice

It's part of AAII's broader AAII Annual Tax Guide, which we update each year to help investors understand how changing rules, thresholds and planning strategies fit together across income, investing and retirement decisions.

Which year-end tax move has had the biggest impact for you-timing income, accelerating deductions, or managing capital gains and what typically triggers you to start tax planning each year?

If you haven't already, this article, and the full 2025-2026 Tax Guide, are worth reviewing now, while there's still time to act rather than react. Click here to read.

Young people take note! Invest in ROTH assets while you're young! If your 401k or other retirement plan has a Roth option, USE IT!

A Roth IRA is vastly superior to the traditional version because of its enhanced flexibility. The small tax deduction you will receive from contributing to a traditional IRA is not worth the aggravation caused by FORCED, TAXABLE distributions in later years. 

I converted my traditional IRA to a Roth back in 1998, when the government allowed me to spread the associated taxes over four years, and every subsequent IRA contribution I made has been to my Roth. I do not regret missing out on the tiny tax deductions I would have received from contributing to a traditional IRA.

Merry Christmas! Still a few years from RMDs. Year end work is closing this year's plan to maximize income and minimize taxes. Optimize to hold taxable income to just at the next tax bracket's lower limit. In particular, harvesting long term capital gains at 0% and doing some Roth conversion each year to create sacred money for the long term.

Year-end tax planning can have a meaningful impact on your after-tax investment returns, yet it's often one of the most overlooked parts of portfolio management. The AAII 2025–2026 Tax Guide: Tax-Planning Strategies for Investors walks through practical steps investors can take before the calendar turns-from timing income and deductions to avoiding underpayment penalties and navigating AMT exposure.

This article focuses on the decisions investors can still control late in the year:

• Whether to accelerate or defer income and deductions

• How to manage capital gains and charitable giving more efficiently

• When AMT rules or safe-harbor requirements can override conventional tax advice

It's part of AAII's broader AAII Annual Tax Guide, which we update each year to help investors understand how changing rules, thresholds and planning strategies fit together across income, investing and retirement decisions.

Which year-end tax move has had the biggest impact for you-timing income, accelerating deductions, or managing capital gains and what typically triggers you to start tax planning each year?

If you haven't already, this article, and the full 2025-2026 Tax Guide, are worth reviewing now, while there's still time to act rather than react. Click here to read.

Disagree. An associate of mine who is a finance professor, did a study that clearly shows that the more you put into the traditional IRA the more you ultimately will have compared to Roth. Take the tax break, there are few, if any, and use a traditional IRA. Would you rather pay taxes on a lot of money or less or no taxes on a smaller amount? As I tell my children, don't make any money and you will not have to worry about taxes.

Young people take note! Invest in ROTH assets while you're young! If your 401k or other retirement plan has a Roth option, USE IT!

A Roth IRA is vastly superior to the traditional version because of its enhanced flexibility. The small tax deduction you will receive from contributing to a traditional IRA is not worth the aggravation caused by FORCED, TAXABLE distributions in later years. 

I converted my traditional IRA to a Roth back in 1998, when the government allowed me to spread the associated taxes over four years, and every subsequent IRA contribution I made has been to my Roth. I do not regret missing out on the tiny tax deductions I would have received from contributing to a traditional IRA.

Merry Christmas! Still a few years from RMDs. Year end work is closing this year's plan to maximize income and minimize taxes. Optimize to hold taxable income to just at the next tax bracket's lower limit. In particular, harvesting long term capital gains at 0% and doing some Roth conversion each year to create sacred money for the long term.

Year-end tax planning can have a meaningful impact on your after-tax investment returns, yet it's often one of the most overlooked parts of portfolio management. The AAII 2025–2026 Tax Guide: Tax-Planning Strategies for Investors walks through practical steps investors can take before the calendar turns-from timing income and deductions to avoiding underpayment penalties and navigating AMT exposure.

This article focuses on the decisions investors can still control late in the year:

• Whether to accelerate or defer income and deductions

• How to manage capital gains and charitable giving more efficiently

• When AMT rules or safe-harbor requirements can override conventional tax advice

It's part of AAII's broader AAII Annual Tax Guide, which we update each year to help investors understand how changing rules, thresholds and planning strategies fit together across income, investing and retirement decisions.

Which year-end tax move has had the biggest impact for you-timing income, accelerating deductions, or managing capital gains and what typically triggers you to start tax planning each year?

If you haven't already, this article, and the full 2025-2026 Tax Guide, are worth reviewing now, while there's still time to act rather than react. Click here to read.

Earl, your finance professor must have been smoking the wrong stuff. Either that, or the prof's assumptions were all wrong. 

To begin with, the maximum contribution to each type of account is exactly the same, and you can invest in exactly the same assets in each account, so they grow exactly the same way. Assuming you eventually take the same amount out of your Roth as you take out of the traditional IRA, SUPPOSEDLY it's a wash between the two types of accounts. But that assumption is faulty because many, if not most, people would not take the same distributions from their Roth that they would be FORCED to take from their traditional IRA. 

I'm a prime example. I will likely never take a distribution from my Roth, so it will continue to grow, whereas I'd be FORCED to take withdrawals--taxed at ORDINARY RATES--from a traditional IRA. Thus, the traditional IRA would fall further and further behind as it was drawn down while my Roth continues to grow. That snowballed growth will dwarf any accumulated TAXABLE returns I could have made from the relatively tiny tax deductions I received from contributing to a traditional IRA. 

With my Roth, I will never have to worry about an RMD pushing me into a higher tax bracket--or a higher IRMAA bracket. And if I do need extra money, I can take a tax-free withdrawal whenever I please. Even aside from the enhanced accumulation one can obtain from a Roth, the freedom and flexibility provided by the Roth trumps the government-mandated taxable drawdowns from a traditional IRA.

Disagree. An associate of mine who is a finance professor, did a study that clearly shows that the more you put into the traditional IRA the more you ultimately will have compared to Roth. Take the tax break, there are few, if any, and use a traditional IRA. Would you rather pay taxes on a lot of money or less or no taxes on a smaller amount? As I tell my children, don't make any money and you will not have to worry about taxes.

Young people take note! Invest in ROTH assets while you're young! If your 401k or other retirement plan has a Roth option, USE IT!

A Roth IRA is vastly superior to the traditional version because of its enhanced flexibility. The small tax deduction you will receive from contributing to a traditional IRA is not worth the aggravation caused by FORCED, TAXABLE distributions in later years. 

I converted my traditional IRA to a Roth back in 1998, when the government allowed me to spread the associated taxes over four years, and every subsequent IRA contribution I made has been to my Roth. I do not regret missing out on the tiny tax deductions I would have received from contributing to a traditional IRA.

Merry Christmas! Still a few years from RMDs. Year end work is closing this year's plan to maximize income and minimize taxes. Optimize to hold taxable income to just at the next tax bracket's lower limit. In particular, harvesting long term capital gains at 0% and doing some Roth conversion each year to create sacred money for the long term.

Year-end tax planning can have a meaningful impact on your after-tax investment returns, yet it's often one of the most overlooked parts of portfolio management. The AAII 2025–2026 Tax Guide: Tax-Planning Strategies for Investors walks through practical steps investors can take before the calendar turns-from timing income and deductions to avoiding underpayment penalties and navigating AMT exposure.

This article focuses on the decisions investors can still control late in the year:

• Whether to accelerate or defer income and deductions

• How to manage capital gains and charitable giving more efficiently

• When AMT rules or safe-harbor requirements can override conventional tax advice

It's part of AAII's broader AAII Annual Tax Guide, which we update each year to help investors understand how changing rules, thresholds and planning strategies fit together across income, investing and retirement decisions.

Which year-end tax move has had the biggest impact for you-timing income, accelerating deductions, or managing capital gains and what typically triggers you to start tax planning each year?

If you haven't already, this article, and the full 2025-2026 Tax Guide, are worth reviewing now, while there's still time to act rather than react. Click here to read.

Disagree. An associate of mine who is a finance professor, did a study that clearly shows that the more you put into the traditional IRA the more you ultimately will have compared to Roth. Take the tax break, there are few, if any, and use a traditional IRA. Would you rather pay taxes on a lot of money or less or no taxes on a smaller amount? As I tell my children, don't make any money and you will not have to worry about taxes.

------------------------------
EARL KUSNIERZ

Original Message:
Sent: 12-26-2025 10:29
From: ROBERT ADAMS
Subject: Year-End Tax Moves That Matter Most

Young people take note! Invest in ROTH assets while you're young! If your 401k or other retirement plan has a Roth option, USE IT!

A Roth IRA is vastly superior to the traditional version because of its enhanced flexibility. The small tax deduction you will receive from contributing to a traditional IRA is not worth the aggravation caused by FORCED, TAXABLE distributions in later years. 

I converted my traditional IRA to a Roth back in 1998, when the government allowed me to spread the associated taxes over four years, and every subsequent IRA contribution I made has been to my Roth. I do not regret missing out on the tiny tax deductions I would have received from contributing to a traditional IRA.

------------------------------
Rob Adams

Original Message:
Sent: 12-25-2025 09:58
From: VICTOR STANKEVICH
Subject: Year-End Tax Moves That Matter Most

Merry Christmas! Still a few years from RMDs. Year end work is closing this year's plan to maximize income and minimize taxes. Optimize to hold taxable income to just at the next tax bracket's lower limit. In particular, harvesting long term capital gains at 0% and doing some Roth conversion each year to create sacred money for the long term.

------------------------------
VICTOR STANKEVICH

Original Message:
Sent: 12-22-2025 11:27
From: Jenna Brashear
Subject: Year-End Tax Moves That Matter Most

Year-end tax planning can have a meaningful impact on your after-tax investment returns, yet it's often one of the most overlooked parts of portfolio management. The AAII 2025–2026 Tax Guide: Tax-Planning Strategies for Investors walks through practical steps investors can take before the calendar turns-from timing income and deductions to avoiding underpayment penalties and navigating AMT exposure.

This article focuses on the decisions investors can still control late in the year:

• Whether to accelerate or defer income and deductions

• How to manage capital gains and charitable giving more efficiently

• When AMT rules or safe-harbor requirements can override conventional tax advice

It's part of AAII's broader AAII Annual Tax Guide, which we update each year to help investors understand how changing rules, thresholds and planning strategies fit together across income, investing and retirement decisions.

Which year-end tax move has had the biggest impact for you-timing income, accelerating deductions, or managing capital gains and what typically triggers you to start tax planning each year?

If you haven't already, this article, and the full 2025-2026 Tax Guide, are worth reviewing now, while there's still time to act rather than react. Click here to read.

------------------------------
Jenna Brashear
AAII Community Manager
Chicago, IL
------------------------------

@Earl,

Your professor is correct for most cases, and trust me when I say from my own survey only about half my CFP professors could explain why this is so. The one who could explain it easily was the lady teaching the topic of taxes, as IRA vs Roth is all about taxes. Take my own example, retired in 2012 at 60 and spending my traditional IRA money in 12% bracket and below. Most years, mid-single digit effect tax. While working contributed to Roth most years once it became available, but this tax cost was 25% to 33% marginal in those days for an income about the same as I now withdraw in retirement in the 12% bracket.  Makes perfect sense in my case to spend IRA money at 12%, rather than Roth money that cost 25%+ to save. It will probably make more sense for the next generation to spend the Roth money in what will most likely be higher tax brackets for them after I am gone.

I have done my own research that suggests the same thing the Bogglehead Wikki supports and that is the if you can get money into the Roth at 12% marginal rate or below, you should probably do it. So, when you are young with not much salary, definitely do the Roth.  How long you have the money in the Roth does not matter, just the tax difference between TIRA spending in retirement vs Roth contributions, Not RMDs, except to the extent you may have oversaved way more than you need and / or have a large taxable account that puts you in a higher tax bracket.

------------------------------
DAVE GILMER

Original Message:
Sent: 12-29-2025 10:44
From: EARL KUSNIERZ
Subject: Year-End Tax Moves That Matter Most

Disagree. An associate of mine who is a finance professor, did a study that clearly shows that the more you put into the traditional IRA the more you ultimately will have compared to Roth. Take the tax break, there are few, if any, and use a traditional IRA. Would you rather pay taxes on a lot of money or less or no taxes on a smaller amount? As I tell my children, don't make any money and you will not have to worry about taxes.

------------------------------
EARL KUSNIERZ

Original Message:
Sent: 12-26-2025 10:29
From: ROBERT ADAMS
Subject: Year-End Tax Moves That Matter Most

Young people take note! Invest in ROTH assets while you're young! If your 401k or other retirement plan has a Roth option, USE IT!

A Roth IRA is vastly superior to the traditional version because of its enhanced flexibility. The small tax deduction you will receive from contributing to a traditional IRA is not worth the aggravation caused by FORCED, TAXABLE distributions in later years. 

I converted my traditional IRA to a Roth back in 1998, when the government allowed me to spread the associated taxes over four years, and every subsequent IRA contribution I made has been to my Roth. I do not regret missing out on the tiny tax deductions I would have received from contributing to a traditional IRA.

------------------------------
Rob Adams

Original Message:
Sent: 12-25-2025 09:58
From: VICTOR STANKEVICH
Subject: Year-End Tax Moves That Matter Most

Merry Christmas! Still a few years from RMDs. Year end work is closing this year's plan to maximize income and minimize taxes. Optimize to hold taxable income to just at the next tax bracket's lower limit. In particular, harvesting long term capital gains at 0% and doing some Roth conversion each year to create sacred money for the long term.

------------------------------
VICTOR STANKEVICH

Original Message:
Sent: 12-22-2025 11:27
From: Jenna Brashear
Subject: Year-End Tax Moves That Matter Most

Year-end tax planning can have a meaningful impact on your after-tax investment returns, yet it's often one of the most overlooked parts of portfolio management. The AAII 2025–2026 Tax Guide: Tax-Planning Strategies for Investors walks through practical steps investors can take before the calendar turns-from timing income and deductions to avoiding underpayment penalties and navigating AMT exposure.

This article focuses on the decisions investors can still control late in the year:

• Whether to accelerate or defer income and deductions

• How to manage capital gains and charitable giving more efficiently

• When AMT rules or safe-harbor requirements can override conventional tax advice

It's part of AAII's broader AAII Annual Tax Guide, which we update each year to help investors understand how changing rules, thresholds and planning strategies fit together across income, investing and retirement decisions.

Which year-end tax move has had the biggest impact for you-timing income, accelerating deductions, or managing capital gains and what typically triggers you to start tax planning each year?

If you haven't already, this article, and the full 2025-2026 Tax Guide, are worth reviewing now, while there's still time to act rather than react. Click here to read.

------------------------------
Jenna Brashear
AAII Community Manager
Chicago, IL
------------------------------