Year-End Tax Moves for Post-Retirees: Charitable Giving and Beyond

As 2024 draws to a close, post-retirees have unique opportunities to optimize their finances and minimize tax burdens. From strategic charitable donations to leveraging specific tax-saving accounts, understanding the tools available can make a big difference in your year-end planning.

Key Year-End Tax Moves for Post-Retirees

1. Qualified Charitable Distributions (QCDs): Post-retirees aged 70½ or older can donate up to $100,000 directly from their IRA to a qualified charity. This strategy reduces taxable income while meeting required minimum distributions (RMDs).
2. Bunching Charitable Contributions: If you’re itemizing, consider bunching several years’ worth of donations into a single year to exceed the standard deduction threshold, allowing for greater tax benefits.
3. Roth IRA Conversions:  Converting traditional IRA funds to a Roth IRA at year-end can lock in today’s tax rates while reducing future RMDs. This is particularly helpful if you’re in a lower tax bracket this year.
4. Capital Gains and Loss Harvesting:  Offsetting capital gains with losses can help manage taxable investment income. Be mindful of the “wash-sale” rule, which could disallow deductions if a security is repurchased within 30 days.
5. Review and Adjust Estimated Tax Payments: If you’ve had unexpected income this year—such as large RMDs or investment gains—review your estimated tax payments to avoid underpayment penalties.

Conclusion

Tax-efficient strategies don’t just reduce your liability—they help maximize what you keep for your retirement lifestyle and legacy. With the right moves, you can finish the year financially stronger and prepared for 2025.