As the final weeks of the year approach, many retirees and near-retirees ask us: “Is there still time to improve my tax situation for 2025?” The answer is yes — and if you act before December 31, you could significantly lower your 2025 tax bill. At THRIVE Wealth Group, we use our Retire Your Way Blueprint™ to guide clients through tax-smart year-end moves that support long-term financial freedom.

Why 2025 Is a Critical Year for Tax Planning

• For 2025, the standard deduction for a single filer is $15,750, and for married couples filing jointly it’s $31,500. IRS+1
• For individuals age 65 and older, the additional “senior” standard deduction bump means many retirees may not itemize — making traditional charitable deductions less valuable. U.S. Bank+1
• Tax brackets under federal income tax remain at 10%, 12%, 22%, 24%, 32%, 35%, and 37%. U.S. Bank+1
• Meanwhile, thanks to inflation adjustments and recent legislation, some tax-efficient planning strategies have become more favorable — especially for retirees. IRS+1

With these changes, 2025 presents some timely opportunities and potential pitfalls — and now is the moment to act.

Four Year-End Moves Worth Considering

Here are four of the most effective strategies we recommend reviewing with your financial advisor or tax professional:

1. Consider a Roth Conversion (Or Partial Conversion)

• Converting some of your traditional IRA funds into a Roth IRA can make sense — especially if your taxable income in 2025 is lower than expected.
• You’ll pay ordinary income tax on the converted amount, but future growth and withdrawals (if rules are followed) may be tax-free.
• Doing a partial conversion helps spread the tax hit and avoid jumping into a higher bracket.

✅ Why it matters: The Tax “World” of your Blueprint becomes more flexible — allowing you to manage future withdrawals and tax exposure.

2. Use Qualified Charitable Distribution (QCD), If Eligible

If you are 70½ or older and have a Traditional IRA (or other eligible account), a QCD can be a powerful tool. Here’s how it works:

• You can donate up to $108,000 directly from your IRA to a qualified 501(c)(3) charity in 2025 per individual (so up to $216,000 for a married couple, each using their own IRA). Fidelity+2Lord Abbett+2
• A QCD is not counted as taxable income and — if you are already subject to RMDs — it also counts toward your annual required minimum distribution. Vanguard+2Schwab Brokerage+2
• Because the QCD lowers your adjusted-gross income (AGI), it can in turn reduce the taxability of other income sources (like Social Security) or help avoid higher Medicare premiums tied to income. Lord Abbett+2WilmingtonBiz+2

Good to know: QCDs must be transferred directly from the IRA custodian to the charity — the funds should not pass through your bank account. Convoy of Hope+1

3. Harvest Tax Losses If You’ve Got Underperforming Investments

• If you hold investments in taxable (brokerage) accounts that are down for the year, consider selling them to realize a capital loss.
• These losses can offset capital gains, or — if losses exceed gains — offset up to $3,000 of ordinary income (with excess carried forward).
• This may reduce your taxable income for 2025 and lower your overall tax bill.

💡 Tip: Before selling, match tax losses with investment strategy — don’t sell just for the tax loss if it disrupts your long-term goals.

4. Review Your Withholding and Estimated Payments

• If you receive pension income, Social Security, or other fixed income sources — check withholding to ensure you’re not underpaying taxes.
• Making an estimated tax payment before year-end can help avoid underpayment of penalties.
• For 2026, inflation adjustments may shift thresholds, so planning now helps you lock in a lower 2025 tax burden.

How These Moves Fit into the Retire Your Way Blueprint™

Blueprint World	Strategic Focus in 2025
Tax	Manage distributions to minimize taxes and control what you keep.
Income	Maintain stable income while using IRA assets intelligently.
Legacy	Combine philanthropy with tax-efficient gifting through QCDs.
Investments	Use loss harvesting or Roth conversions as part of long-term allocation planning.
Healthcare	Lower AGI to help manage thresholds for Social Security tax and Medicare IRMAA.

By integrating these tactics, you’re not simply reacting to year-end — you’re proactively optimizing your retirement plan under the Blueprint.

When It Makes Sense — And When to Be Cautious

👍Consider these moves if:

• You expect lower-than-usual taxable income in 2025 (e.g., limited withdrawals, reduced work income, or lower capital gains).
• You’re charitably inclined and if you qualify for QCD.
• You hold underperforming taxable investments that no longer align with long-term goals.

⚠️Use caution if:

• You expect income to increase significantly in 2026 or later — a Roth conversion could increase future tax burden if not planned properly.
• You depend on standard deductions and don’t itemize, reducing the benefit of charitable deductions (though QCDs can still help by lowering AGI).
• You anticipate legislative or tax-law changes that might impact retirement account rules — always coordinate with a tax advisor.

Next Steps — Our Recommended Process

1. Run the numbers — review projected 2025 income, required withdrawals, and Social Security taxability.
2. Consider a partial Roth conversion — model the tax impact now vs. future benefit.
3. Evaluate charitable goals — identify preferred charities and check that they are 501(c)(3) eligible.
4. Sell underperforming investments only if aligned with a long-term strategy.
5. Coordinate with your tax advisor or accountant — especially if you have significant IRA balances or combined income sources.

We believe tax planning isn’t a once-a-year task — but year-end offers a rare window where the stars align. For many retirees, these moves can translate into real dollars kept, future flexibility gained, and the peace of mind that comes from a plan. 

For a tax strategy session, please contact our office to schedule a meeting. Our team would encourage you to take control of your financial future by ensuring your plan is working for you versus against you.  

– Trent Martin, Senior Financial Advisor | THRIVE Wealth Group