Thirty years ago, I worked in the inner city helping prepare taxes as a volunteer.

From then to today, there have been many new laws created to help working families with deductions, expenses, tax rates, education and retirement.

President Trump has gone the extra mile by implementing the new benefits for workers and retirees such as; the No Tax on Tips, No Tax on Overtime and No Tax on Social Security which is awesome for people trying to survive paycheck to paycheck.

These laws eliminate or reduce taxes on those who earn overtime, tips and Social Security benefits. As the year draws to a close, it’s critical to sharpen your tax and financial planning strategies.

Acting before December 31st can reduce your liability, strengthen your financial position, and ensure you don’t miss opportunities hidden in the holiday rush.

With the passage of the One Big Beautiful Bill Act, working Americans and seniors now have additional deductions available beginning in 2025—making proactive planning more important than ever.

Common Oversights and Mistakes to Avoid

·     Failing to Maximize Retirement Contributions For tax year 2025 (returns filed in 2026), U.S. workers can contribute more to retirement accounts as IRS limits rise with inflation: the employee deferral limit for 401(k), 403(b), most 457 plans, and the Thrift Savings Plan increases to $23,500, while the IRA contribution limit remains $7,000. Workers age 50 and older can add a $7,500 401(k) catch-up (total $31,000), and under SECURE 2.0 those ages 60–63 may contribute an enhanced $11,250 catch-up (total $34,750).

The combined employee-and-employer 401(k) contribution cap is $70,000, excluding employer matches from the employee limit and allowing after-tax contributions in some plans to reach the maximum.

IRA contributors age 50+ may add a $1,000 catch-up (total $8,000), and Roth IRA income phase-outs rise to $150,000–$165,000 for singles and $236,000–$246,000 for married couples filing jointly.

The deadline to adjust 401(k) contributions is December 31, 2025, while IRA contributions for 2025 can be made until April 15, 2026.

·     Improper Timing of Capital Gains and Losses Capital Gains Taxation: Long-term capital gains are subject to federal tax rates of 0 percent, 15 percent, or 20 percent , depending on taxable income, while short-term capital gains are taxed as ordinary income , at rates up to 37 percent, plus the 3.8 percent net investment income tax where applicable.

·     Overlooking Alternative Minimum Tax (AMT) Though fewer taxpayers are affected, AMT can still bite. Delay exercising incentive stock options and confirm municipal bonds are AMT‑exempt.

·     Missing Required Minimum Distributions (RMDs) An individual who attains age 73 must begin taking required minimum distributions from applicable retirement plans in accordance with IRC §401(a)(9).

If the full amount of the required minimum distribution is not withdrawn for a taxable year, an excise tax equal to 25 percent of the undistributed amount is imposed under IRC §4974.

The excise tax is reduced to 10 percent if the failure is timely corrected and the taxpayer files the applicable return and pays the reduced tax in accordance with Treasury and IRS procedures.

·     Underutilizing 529 Education Savings Plans Contributions up to $19,000 per person to a beneficiary (or $95,000 with the five‑year rule) grow tax‑free. Some states allow for a meaningful State Income Tax deductions for a contribution to your states preferred 529 Plan.

·     Neglecting Health Savings Accounts (HSAs) HSAs provide triple tax benefits—deductible contributions, tax‑free growth, and tax‑free withdrawals for qualified medical expenses.

·     Forgetting Year-End Gifting The 2025 annual exclusion is $19,000 per recipient. Gifting appreciated assets can shift tax burdens to lower brackets.

·     Other overlooked deductions

o  Offset Tax Losses - Losses from stocks may offset crypto gains.

o  Casualty and Theft Losses: Casualty and theft losses are deductible under IRC §165, subject to applicable limitations. For individuals, personal casualty losses are generally deductible only to the extent they arise from a federally declared disaster . Losses related to trade, business, or income-producing property may be deductible regardless of disaster designation.

o  Qualified Performing Artists: Certain qualified performing artists may deduct allowable trade or business expenses as an adjustment to income on Form 1040, subject to the requirements and limitations set forth in IRC §62(a)(2)(B).

o  Authors and Writers: Authors generally deduct ordinary and necessary expenses incurred in carrying on a trade or business on Schedule C (Form 1040) under IRC §162

o  Sponsorships and marketing expenses to local schools and charities can qualify as deductible business advertising.

New Relief Under the One Big Beautiful Bill Act (Effective 2025–2028)

·     “No Tax on Tips” Deduction – Up to $25,000 of qualified tips may be deducted, phasing out above $150,000 MAGI ($300,000 joint).

·     “No Tax on Overtime” Deduction – Deduct up to $12,500 ($25,000 joint) of overtime premium pay. This is where Trump is rewarding those who work the hardest and contribute the most.

·     “No Tax on Car Loan Interest” Deduction – Up to $10,000 of interest on qualifying U.S.-assembled vehicles purchased after 12/31/2024.

·     New Senior Deduction – Taxpayers age 65+ may claim an additional $6,000 deduction ($12,000 for couples), phasing out above $75,000 MAGI ($150,000 joint).

Proactive Action Steps for Year-End Success

·     Evaluate and Adjust Retirement Contributions

·     Review Your Investment Portfolio

·     Be Mindful of AMT Exposure

·     Schedule and Verify RMDs

·     Fund Education Savings Plans

·     Leverage HSAs

·     Optimize Gifting Strategies

·     Plan Ahead for New 2025 Deductions: Track tips, overtime, car loan interest, and senior status to maximize relief under the new law.

Conclusion

By combining traditional year‑end strategies with the new deductions from the One Big Beautiful Bill Act, taxpayers can significantly reduce liability and strengthen their financial outlook.

Most all tax activity, donations, expenses and gifts must be made within the fiscal year from Jan 1st to Dec 31st; however, retirement contributions are unique.

Certain retirement-related contributions may be made up to April 15 of the following year and can still apply to the prior tax year, most notably Traditional IRAs, Roth IRAs, SEP-IRAs, employer SIMPLE IRA contributions, and Health Savings Accounts (HSAs).

Traditional IRA contributions made by this deadline may be deductible, potentially generating or increasing a tax refund, while Roth IRA contributions, although allowed by April 15, do not produce a current-year tax deduction or refund but offer future tax-free withdrawals.

SEP-IRA and employer SIMPLE IRA contributions are generally deductible business expenses and may reduce taxes owed or increase a refund, particularly for self-employed individuals and small business owners.

HSA contributions made by April 15 are above-the-line deductions that frequently increase refunds. By contrast, 401(k), 403(b), 457, TSP, and employee deferrals must be made by December 31 and cannot be added after year-end.

Don’t wait until January—act now to secure your financial future. Consult a licensed tax professional to tailor these strategies to your circumstances and ensure compliance with IRS guidance.

Disclaimer: Always consult with a licensed professional before making tax decisions.

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Commissioner George Mentz JD MBA CILS CWM® holds a Doctor of Jurisprudence (JD), and an MBA from ABA and AACSB Accredited programs. Mentz is the first in the USA to rank as a Top 50 Influencer & Thought Leader in: Management, PM, HR, FinTech, EdTech, Wealth Management, and B2B according to Onalytica.com and Thinkers360.com. George Mentz JD MBA CILS is a CWM Chartered Wealth Manager ®, global speaker - educator, tax-economist, international lawyer and CEO of the GAFM Global Academy of Finance & Management ®. The GAFM is a EU accredited graduate body that trains and certifies professionals in 150+ nations under standards of the: US Dept of Education, ACBSP, ISO 21001, ISO 991, ISO 29993, QAHE, ECLBS, and ISO 29990 standards. Mentz is also an award-winning author and award winning graduate law professor of wealth management of one of the top 25 ranked law schools in the USA and is founder of the ChE Chartered Economist ® certification & education programs. George Mentz has served as a White House Commissioner, and has served the Civil Service Commission for Police and Fire and the Airport Commission (Home of Space Force). Comm'r Mentz is one of the few lawyers who has ever earned Wall Street Firm licenses of Series 7,63, and 65 , served as a Judge for the ABA, has led civil litigation cases in fraud and defamation, as well as testified as an expert in FINRA/NASD financial arbitration.