Year-End Tax Planning Checklist for Raleigh Individuals

Introduction

A year-end review can help individuals organize records, adjust tax payments, and identify retirement contributions or deductions that may affect the upcoming tax return. This checklist uses 2026 federal tax information and is intended for general education—not individualized tax advice.

1. Review your income and tax withholding

Start by estimating your total 2026 income, including:

• Wages and bonuses
• Self-employment income
• Interest, dividends, and capital gains
• Retirement or pension distributions
• Rental income
• Unemployment compensation
• Tips and other income

If your withholding is too low, you may need to increase withholding or make an estimated tax payment. Generally, estimated tax payments may be required when you expect to owe at least $1,000 after subtracting withholding and refundable credits, and your withholding and credits are less than the smaller of 90% of your expected 2026 tax or 100% of your 2025 tax. The prior-year percentage increases to 110% if your 2025 adjusted gross income was more than $150,000, or $75,000 if you are married filing separately.

For taxpayers using the calendar year, the final 2026 estimated tax payment is generally due January 15, 2027. If you receive most of your income late in the year, an annualized-income approach may help determine whether your required payments should be uneven rather than divided into four equal installments.

Check for new or changing deductions

Some 2026 deductions may affect your taxable income and withholding, including potential deductions for:

• Qualified tips, up to $25,000
• Qualified overtime compensation, up to $12,500, or $25,000 for married couples filing jointly
• Qualified passenger vehicle loan interest, up to $10,000
• The enhanced senior deduction, up to $6,000 per eligible person

Each deduction has separate eligibility rules and income limitations. For example, the tips and overtime deductions generally begin to phase out when modified adjusted gross income exceeds $150,000, or $300,000 for married couples filing jointly.

2. Maximize retirement contributions

Retirement contributions are one of the most important year-end tax planning items for individuals. Review both your workplace plan and any IRA contributions before the end of the year.

Review your 401(k), 403(b), or 457(b) contributions

For 2026, the elective deferral limit for 401(k), 403(b), and most governmental 457(b) plans is $24,500. Participants who are age 50 or older by the end of 2026 may generally contribute an additional $8,000. For participants ages 60 through 63, the higher catch-up limit is $11,250.

Check your year-to-date contributions and ask your employer about the final payroll deadline for making additional contributions. If you changed jobs during the year, also review contributions made to prior employers’ plans so you do not unintentionally exceed the combined elective deferral limit.

The overall annual contribution limit for a 401(k) plan is generally the lesser of 100% of compensation or $72,000 for 2026. This broader limit can include employee deferrals, employer matching contributions, and employer nonelective contributions.

Consider a traditional IRA contribution

For 2026, the combined contribution limit for traditional and Roth IRAs is generally $7,500, or $8,600 for individuals age 50 or older. The limit applies to contributions made to all of your traditional and Roth IRAs, subject to special rules for employer contributions to SEP and SIMPLE arrangements. Contributions are also limited by taxable compensation.

A traditional IRA contribution may be deductible, but the deduction can be reduced or eliminated when you or your spouse participates in an employer retirement plan. For 2026, the deduction phaseout for a taxpayer covered by a workplace plan begins at modified adjusted gross income of:

• $81,000 for single or head-of-household filers and ends at $91,000
• $129,000 for married couples filing jointly when the contributor is covered by a workplace plan and ends at $149,000
• $242,000 for married couples filing jointly when the contributor is not covered but the spouse is covered and ends at $252,000
• More than $0 but less than $10,000 for married individuals filing separately who are covered by a workplace plan

These limits affect deductibility, not necessarily the ability to make a contribution. A nondeductible contribution generally must be reported on Form 8606.

Review Roth IRA eligibility

Roth IRA contributions are not deductible, but qualified distributions may be tax-free. For 2026, the Roth IRA contribution phaseout ranges are:

• $153,000 to $168,000 for single or head-of-household filers
• $242,000 to $252,000 for married couples filing jointly
• More than $0 but less than $10,000 for married filing separately when the taxpayer lived with the spouse during the year

A taxpayer whose modified adjusted gross income is at or above the applicable upper limit generally cannot make a regular Roth IRA contribution.

3. Review deductions and tax payments

Decide whether itemizing may help

For 2026, the standard deduction is:

• $16,100 for single or married filing separately
• $32,200 for married filing jointly or qualifying surviving spouse
• $24,150 for head of household

You may benefit from itemizing if your allowable deductions exceed the standard deduction. Common items to review include mortgage interest, charitable contributions, state and local taxes, qualifying medical expenses, and certain casualty losses.

Review state and local tax payments

For 2026, the federal deduction for state and local income, sales, and property taxes is generally limited to $40,400, or $20,200 for married individuals filing separately. The limit begins to phase down when modified adjusted gross income exceeds $505,000, or $252,500 for married filing separately, but it generally cannot be reduced below $10,000, or $5,000 for married filing separately.

If you expect to itemize, gather records for state income tax withholding, estimated payments, real estate taxes, and qualifying personal property taxes. Do not assume that every fee on a property tax bill is deductible; charges for specific services and certain local improvements may be treated differently.

Organize charitable contribution records

Beginning in 2026, individuals who do not itemize may be able to deduct cash contributions to eligible tax-exempt organizations, up to $1,000, or $2,000 for married couples filing jointly. Donor-advised funds and supporting organizations are excluded from this non-itemizer deduction.

Individuals who itemize may deduct charitable contributions only to the extent contributions exceed 0.5% of adjusted gross income, in addition to other applicable percentage-of-income limits. Keep receipts, written acknowledgments, and other records supporting the date, amount, and recipient of each contribution.

Review medical and casualty expenses

Medical expenses are generally deductible only to the extent they exceed 7.5% of adjusted gross income. Review unreimbursed medical and dental bills, prescription costs, insurance premiums, and other qualifying expenses.

Personal-use casualty and theft losses are generally deductible only when connected with a federally declared disaster or, beginning in 2026, a state-declared disaster. The loss is also subject to a $100 reduction per event and a reduction for 10% of adjusted gross income after applying the per-event reduction.

4. Gather records and prepare for tax filing

Year-end tax preparation is easier when records are organized before tax season. Create a folder for:

• Forms W-2, 1099, and retirement distribution statements
• Brokerage statements and capital gain information
• Mortgage interest and property tax records
• Charitable contribution receipts
• Medical expense documentation
• Retirement contribution confirmations
• Estimated tax payment records
• Records for qualified tips, overtime, or vehicle loan interest
• Documentation for business, rental, or self-employment income

You should keep receipts, canceled checks, account statements, and other records that support deductions and credits. Generally, records should be retained until the applicable period of limitations expires; longer retention may be necessary for property records, amended returns, unreported income, or fraudulent returns.

A CPA can also help identify missing information, reconcile income reported on tax forms, and evaluate whether your withholding and estimated tax payments are aligned with your expected liability. For Triangle-area individuals and families with multiple income sources, retirement accounts, investment activity, or self-employment income, an organized year-end review can make tax preparation more efficient.

Conclusion

A year-end tax planning checklist can help individuals review their income, retirement contributions, deductions, tax payments, and supporting records before filing season begins. Stancil CPA can help you organize your information and prepare for your individual tax return. Schedule a consultation with our team to discuss your year-end tax preparation needs.