There’s an important difference between tax preparation and tax planning.

And it can have a major impact on how much total tax you pay throughout your lifetime.

Tax preparation is what you do every year before April 15^th.

At this point, you’re mostly just reporting on what happened last year, and calculating taxes due. Sure, there are deductions to maximize, and savings to be had. But it’s often a fraction of the total savings to be achieved through strategic tax planning.

So what is tax planning?

Tax planning is understanding and using tax laws to your advantage, arranging your financial situation to minimize your lifetime tax liability and optimize for after-tax income. Making decisions focused not just on the current tax year, but designed to minimize your tax obligations throughout your lifetime.

Some of it is just smart planning for the upcoming tax season. But other steps may involve taking more taxable income this year to take advantage of potential long-term tax reduction opportunities.

Tax planning isn’t just a rich person’s game, either.

Many middle-American families who’ve been good savers could see $10,000s or even $100,000s of lifetime tax savings through effective long-term tax strategy.

With that in mind, here are 10 tax planning steps worth considering now, before we get too late in the year.

1. Project your total 2026 income

Don’t just double the income shown on your June pay stub.

Include wages, bonuses, pension income, Social Security, interest, dividends, capital gains, business income, retirement-account withdrawals and other taxable income. Then compare the projection with the 2026 tax brackets and deductions.

For 2026, the standard deduction is $32,200 for married couples filing jointly, $16,100 for single filers and $24,150 for heads of household. Tax brackets range from 10% to 37% marginal tax rates, based on your taxable income and filing status.

The first step to understanding your tax obligations for any tax year is getting a clear picture of where your taxable income is likely to land.

2. Check your withholding and estimated payments

You could end up with a nasty tax surprise if you don’t adjust withholding for a major raise, retirement, investment sale, business-income change, or large IRA withdrawal.

Conversely, excessive withholding may mean unnecessarily reducing each paycheck throughout the year. The IRS withholding estimator has been updated to reflect 2026 tax-law changes. People with significant income that is not subject to withholding may also need estimated tax payments.

3. Check the pace of your retirement contributions

Someone who wants to maximize a workplace plan should calculate how much remains and divide it across the remaining pay periods.

The 2026 employee contribution limit for 401(k), 403(b), and governmental 457 plans is $24,500. The standard age-50 catch-up is $8,000, while eligible participants ages 60 through 63 may have an $11,250 catch-up limit. The IRA contribution limit is $7,500, plus a $1,100 catch-up for people age 50 or older.

While different retirement plans have different requirements and constraints, each can provide specific tax advantages. Depending on your unique situation, you may be able to manage your lifetime tax obligations through effective use of these accounts.

4. Decide whether 2026 is a good Roth-conversion year

Many people believe Roth conversions are an automatic tax-saving move. That’s not always the case, and it depends on your personal tax and income situation.

A Roth conversion creates taxable income this year. Depending on your other income, that could be at a lower or higher tax rate than you’d pay in other years.

One example where it might offer an advantage could be during a lower-income year. This could be early in retirement, before filing for Social Security, and before Required Minimum Distributions (RMDs). Some people choose to do Roth conversions during this window to max out lower tax brackets, and reduce taxable income later.

Converted amounts must be reported for tax purposes. Qualified Roth IRA distributions may eventually be tax-free, and original Roth IRA owners are not subject to lifetime RMDs.

To determine if a Roth conversion could make sense for you, it makes sense to work with your financial advisor and tax professional to compare potential options, and see where it might make sense.

5. Increase HSA contributions, when eligible

A Health Savings Account (HSA) can offer a current deduction, tax-deferred growth, and tax-free distributions for qualified medical expenses.

This triple tax advantage can make them a highly-effective tax planning vehicle, for those who qualify. In order to qualify, you must be enrolled in an IRS-qualified high-deductible health insurance plan, and not have Medicare or any other health insurance.

The 2026 HSA contribution limit is $4,400 for self-only coverage and $8,750 for family coverage. This has the potential to be completely tax-free income, when used for qualified medical expenses through an HSA.

If you qualify this year, it could be a good time to make sure you’re setup to make the most of this opportunity.

6. Review capital gains and losses before making major sales

For after-tax investments (such as those in traditional brokerage accounts or real estate), all sales need to be carefully considered in a tax context. Investors should review what gains have already been realized in this tax year, as well as what they may sell during the rest of the year.

Doing this could reveal opportunities to:

• Offset realized gains with capital losses.
• Avoid creating an unnecessarily large gain in one year.
• Spread planned sales across multiple years.
• Deliberately realize gains during an unusually low-income year.

For 2026, the top of the 0% long-term capital-gains bracket is $98,900 of taxable income for married couples filing jointly and $49,450 for most single filers. Loss-harvesting decisions must also account for the wash-sale rules.

7. Make a charitable-giving plan before December

Waiting until the final days of December to decide your charitable giving plan can limit your available options.

The planning conversation might include cash gifts, donating appreciated investments, bunching multiple years of donations, or using a donor-advised fund. Beginning with tax year 2026, non-itemizers may deduct up to $1,000 of qualifying cash gifts, or $2,000 for joint filers.

Of course, all charitable giving should start with your values, and what organizations you’d like to support. But once you’ve made that decision, tax strategy can help more of your dollars get to the important work you wish to support.

8. Coordinate required distributions with charitable giving

People subject to RMDs should not wait until December to begin planning the withdrawal.

IRA owners age 70½ or older may be able to make qualified charitable distributions directly to eligible charities. A QCD can satisfy some or all of an IRA RMD, and the 2026 QCD exclusion limit is $111,000 per eligible individual.

Useful distinction: QCD eligibility begins at age 70½, even though RMDs generally begin later.

9. Reconsider whether you will itemize in 2026

It’s smart not to assume last year’s deduction strategy will be correct for this year.

The 2026 federal limit for deductible state and local taxes is $40,400 for most filers, although it begins to decline at higher income levels. That change — combined with charitable gifts, mortgage interest, and deductible medical expenses — could affect whether someone itemizes or takes the standard deduction.

It’s worth also reviewing any newer deductions for seniors, qualified overtime, tips, or qualifying vehicle-loan interest apply to your situation.

10. Check the long-term consequences of lowering — or increasing — income

This is maybe the biggest strategic decision you can make.

A Roth conversion, capital gain, or retirement withdrawal can affect more than the ordinary-income tax bracket. It may also affect deductions, credits, the 3.8% net investment income tax, and future Medicare premiums.

Medicare generally uses modified adjusted gross income from two years earlier when determining income-related Part B and Part D charges. That means decisions made during 2026 may affect Medicare costs in 2028. This functions as a “cliff tax,” where just $1 more in income could cause premiums to double.

Every strategy interacts with everything else. If you’re not careful, one move could trigger a domino effect of tax consequences. Tax moves should be modeled together, not considered one at a time.

BONUS: Plan for your 2026 tax preparation season now

If you’re not already working with a tax preparer or are considering a move, it can be a major mistake to wait until January. A good tax preparer often fills their tax preparation schedule before the new year.

Not only that, many tax planning moves are best coordinated before the end of the calendar year. If you wait until January 1^st, many potential tax saving moves are simply no longer available.

Fall can also be an ideal time to coordinate tax planning between your tax preparer and financial advisor. Especially if you’re in retirement, or your tax planning involves your investment accounts. Having everyone working together can help with getting the details right, and ensuring no balls get dropped.

We are partnered with Asset Strategies Tax & Accounting to offer tax preparation and accounting services to our clients. Asset Strategies Tax & Accounting also provides tax strategy consultation and coordinated tax strategy implementation for shared clients of Asset Strategies financial advisors.

To connect with Asset Strategies Tax & Accounting, email [email protected] or call (402) 256-1099.