To Inform:

Don’t blink now, but the end of October is right around the corner! At this point, Christmas decorations are creeping into and starting to takeover stores. What does this mean? Before the craziness of the holiday season begins, now is the perfect time to review your financial picture, wrap up any loose ends of the year, and take advantage of a few opportunities!

Required Minimum Distributions & Qualified Charitable Distributions

Let’s start with what the government requires by the end of the year. That is, the Required Minimum Distribution (RMD). Starting at age 73, the RMD is the minimum amount of money you must withdraw each year from your tax-deferred retirement accounts – such as IRAs, traditional 401(k)s, etc. These distributions are taxed as ordinary income. Unless…you take advantage of a savvy tool called the Qualified Charitable Distribution (QCD). This is a great opportunity to keep in mind as you think about your charitable giving at the end of the year. Starting at age 70 1/2, a QCD allows you to donate up to $111,000 per person (in 2026) from an IRA to an eligible charity. So, in short, you can fulfill your RMD tax-free by donating it to charity as a QCD. Two birds, one stone!

Gifting

In sticking to the theme of generosity, year-end brings a season of gift giving with it. As you’re thinking through how to bless others, remember the gift tax exclusion. For 2026, the gift tax exclusion is $19,000 per recipient without paying gift tax or filing a special return. Married couples can combine their individual limits to gift up to $38,000 per recipient tax-free. If you give more than the limit to a single recipient in a year, you don’t owe tax on the excess. Rather, it chips away at your $15 million ($30 million if married) lifetime exemption. Keep in mind that if you do give more than the limit to a single recipient in a year, you must file a gift tax return with the IRS to track the amount applied against your lifetime limit. And an added bonus? The gift amount is never treated as taxable income for the recipient. Taking advantage of the gift tax exclusion gives you the opportunity to greatly impact the lives of those you love!

Max Out Employer Sponsored Plans

An item that is specifically year-end sensitive and easy to overlook is maximizing your contributions to your employer sponsored plan (401(k), 403(b), etc.) Now, I say easy to overlook because you can make 2026 contributions to traditional and Roth IRAs all the way up to April 15^th of 2027. This is not the case with employer sponsored plans! If you want to increase or max out your contribution in 2026, it must be done by December 31, 2026. Now, one thing I encourage everyone to take advantage of, if you can, is at least contributing enough to get your full employer match. Not getting your full employer match is essentially leaving free money on the table, and out of your plan.

The limit to which an individual can contribute to their plan in 2026 is:

• 49 or younger – $24,500
• 50 to 59 – $32,500
• 60 to 63 – $35,750
• 64 and older – $32,500

If you have the financial ability to, maxing the contribution limit to your employer sponsored plan is a powerful tool, especially over time, to set yourself up well for retirement.

Looking forward to 2027

No matter what your life stage or financial picture, now is an opportune time to review this year and think about what next year may hold. What are some goals you’d like to set? Are there milestones coming up you want to be ready for? These are just a couple questions to get the juices flowing! Finally, be sure to share any decisions, ideas, and questions with your financial advisor and tax consultant. These last few months can go by fast and 2027 will be here before we know it! Let’s finish 2026 strong and set ourselves up well for 2027.

Written by Kaleb Luke, Wealth Advisory Associate