Tax Planning Isn’t Just for April: Year-Round Strategies You Should Know

When most people hear “tax planning,” they think of the mad dash before April 15. But the smartest tax strategies aren’t made at the last minute, they’re planned throughout the year. Proactive, year-round tax planning may help you minimize your tax burden, take advantage of valuable opportunities, and align your financial goals more effectively.

Winter: Reflect and Strategize

The beginning of the year is the perfect time to evaluate your financial goals and review the previous year’s tax return. Did you owe more than expected? Did you miss out on deductions? Use this insight to create a plan. Update your W-4 if necessary, and set up contributions to tax-advantaged accounts like IRAs or HSAs early in the year to maximize compound growth.

Spring: File Smart, Then Look Ahead

While tax season is in full swing, focus on accurate filing and identifying missed opportunities. Review credits and deductions that apply to your situation, such as education, child care, or energy-efficient home upgrades. Then shift gears and begin preparing for next year by organizing receipts, digital records, and charitable donation documents in a central location.

Summer: Mid-Year Check-In

Summer is a great time to assess your current income, spending, and investment performance. Are you on track to hit your savings goals? If your income has changed due to a raise, bonus, or side business, you may need to adjust estimated tax payments or withholdings. Consider a Roth IRA conversion or charitable giving strategies now, when there’s time to weigh your options.

Fall: Fine-Tune and Maximize

As the year winds down, evaluate strategies like tax-loss harvesting, maxing out retirement contributions, or bundling deductions (such as charitable donations) to surpass itemization thresholds. Business owners should consider equipment purchases or bonus depreciation timing. This is also the time to consider Required Minimum Distributions (RMDs) if you're retired or managing a trust.

Tax planning isn’t a once-a-year chore, it’s an ongoing part of a smart financial life. Taking a proactive, year-round approach puts you in control, potentially saving thousands and reducing stress.

Want help building a personalized tax strategy that works across the calendar? Contact Stonecrop Advisors at info@stonecropadvisors.com. We’ll help you make the tax code work in your favor, every month of the year.