End of Year Checklist for Your Taxes, Points and Miles
Timestamps are as accurate as they can be but may be slightly off. We encourage you to listen to the full context.
Podcast Summary
This episode delivers a comprehensive end-of-year financial checklist covering critical tax decisions, retirement planning, and credit card strategies that could save listeners thousands of dollars. Chris walks through 10 key tax topics including the new increased SALT cap from $10,000 to $40,000, strategic charitable giving using donor-advised funds, and essential retirement account deadlines. (01:00)
- Core focus on actionable year-end moves for taxes, retirement accounts, and credit card optimization before December 31st
Speakers
Chris Hutchins
Chris is the host of the All The Hacks podcast and a financial optimization expert who helps ambitious professionals maximize their money, points, and life strategies. He previously worked at Google and has extensive experience in financial planning, credit card rewards optimization, and tax strategy implementation.
Key Takeaways
Master the Standard Deduction vs. Itemizing Decision
The foundation of year-end tax strategy lies in understanding whether you'll take the standard deduction ($15,750 single, $31,500 married filing jointly) or itemize deductions. (01:03) This decision drives nearly every other tax move you'll make. The key insight is to "bunch" deductions strategically - loading up itemized deductions in one year to exceed the standard deduction threshold, then taking the standard deduction the following year. This approach allows you to maximize tax benefits across multiple years rather than settling for marginal gains annually.
Leverage the Expanded SALT Cap Strategically
The state and local tax (SALT) deduction limit increased dramatically from $10,000 to $40,000 for taxpayers under $500,000 income. (03:02) This creates opportunities to prepay property taxes or mortgage payments due early next year, effectively pulling future deductions into the current tax year. For business owners, pass-through entity taxes offer an additional workaround, allowing businesses to pay state taxes on behalf of owners and deduct them as business expenses, bypassing personal SALT limitations entirely.
Optimize Charitable Giving with Donor-Advised Funds
Rather than donating cash, donate appreciated securities to avoid capital gains taxes while receiving the full market value as a deduction. (07:07) Donor-advised funds solve the complexity of donating stocks to multiple charities by creating a personal charitable account where you contribute now, get the deduction immediately, but decide on distributions later. This strategy becomes even more valuable in 2025 since 2026 will introduce a 0.5% AGI floor for charitable deductions, making this the optimal year to front-load charitable contributions.
Maximize Retirement Account Contributions Before Deadlines
Employee 401(k) contributions ($23,500 limit, $7,500 catch-up) must be completed through payroll by December 31st. (25:46) The mega backdoor Roth strategy allows high earners to contribute up to $69,000 total to their 401(k) by making after-tax contributions and converting them to Roth within the plan. For those with side income, solo 401(k)s must be established by year-end, though contributions can continue until tax filing deadlines. These accounts provide powerful tax-deferred growth opportunities that compound over decades.
Execute Tax-Loss Harvesting While Avoiding Wash Sale Rules
Systematically review investments for tax-loss harvesting opportunities to offset gains or reduce ordinary income by up to $3,000 annually. (20:52) The critical rule: avoid buying substantially identical securities within 30 days of selling for a loss, including across all accounts (spouse's IRA, etc.). Instead, swap to similar but not identical ETFs or index funds. Conversely, if you're in a low-income year, consider gain harvesting to take advantage of 0% capital gains rates. Remember that wash sale rules don't apply to crypto or charitable donations of appreciated assets.
Statistics & Facts
- The SALT (state and local tax) deduction cap increased from $10,000 to $40,000 for taxpayers under $500,000 income in 2025. (03:02) This represents a 300% increase that significantly benefits those in high-tax states who previously hit the old limit.
- The 2025 standard deduction amounts are $15,750 for single filers and $31,500 for married filing jointly. (01:46) These figures serve as the benchmark for determining whether itemizing deductions provides greater tax benefits.
- The 401(k) employee contribution limit for 2025 is $23,500 with an additional $7,500 catch-up contribution for those 50 and older. (25:51) The total 401(k) limit including employer contributions reaches $69,000, enabling the mega backdoor Roth strategy.
