How to Lower Your 2025 Taxes Before Filing in 2026: Last-Minute Tax-saving Strategies
- 19 minutes ago
- 4 min read
December 31 has passed. Your income for 2025 is fixed. However, that doesn't mean the same applies to your taxes.
Yes!You might still be able to lower your 2025 taxes before you file your return in 2026.
While most tax planning moves must be completed before 12/31, a select few strategies remain available until the tax filing deadline. Here's how to lower your 2025 taxes after year-end but before filing:
Lower Your 2025 Taxes With an IRA Contribution before April/15
One of the simplest ways to lower your 2025 taxes is by making a 2025 IRA contribution before April 15th (not the extended filing deadline) in 2026.
Ways an IRA Can Lower Your 2025 Taxes
Deductible Traditional IRA contributions - Contributions are often tax-deductible (subject to income limits and whether you have an employer-sponsored retirement plan).
Roth IRA contributions - Contributions provide no immediate tax break, but qualified withdrawals in retirement are tax-free.
Spousal IRA contributions - Contributions for a non-working or low-earning spouse by the working spouse, if the joint income qualifies.
Pro Tip:
Even if you haven’t yet set up an IRA, you can still open one before the filing deadline and contribute for the prior year - double-check the rules and contribution limits based on your age and income level.
Lower Your 2025 Taxes as a Business Owner With SEP-IRA or Solo 401(k) Contributions
If you are self-employed or own a business, you may still lower your 2025 taxes by making employer retirement contributions. Learn more about SEP IRA vs Solo 401(k) here
Contributions That Can Lower Your 2025 Taxes
SEP IRA contributions
Solo 401(k) employer contributions
Unlike IRA and Roth IRA contributions that have the same contribution deadline, SEP IRA and Solo 401(k) employer contribution deadlines vary depending on entity type:
Key Deadlines
Without Extension
Sole Proprietors: April 15, 2025
S-Corporations/Partnerships: March 15, 2025
With Extension
Sole Proprietors: October 15, 2025
S-Corporations/Partnerships: September 15, 2025
These contributions reduce taxable income for 2025 and may also improve your eligibility for the Qualified Business Income (QBI) deduction. Under the updated 2025 tax thresholds, lowering taxable income could restore or increase your QBI benefit.
Pro Tip:
For S-Corporation owners, Schedule C businesses, and 1099 professionals, this is often the largest remaining opportunity to lower your 2025 taxes. Work with a tax professional to ensure you’re accurately calculating and timing your contributions. The rules can be tricky, and you want to avoid missing deadlines or misclassifying your contributions.
Lower Your 2025 Taxes by Maximizing Your HSA Contribution
If you were covered by a high-deductible health plan in 2025, you can still lower your 2025 taxes by funding your Health Savings Account before April 15, 2026, no extension allowed.
How an HSA Helps Lower Your 2025 Taxes
Contributions are tax-deductible
Growth is tax-deferred
Withdrawals are tax-free for qualified expenses
Pro Tip:
Confirm HSA eligibility for each month claimed.
Review last-month rule testing requirements.
Correct any excess contributions before penalties apply.
Lower Your 2025 Taxes by Making 529 Plan Contributions
A 529 plan is a tax-advantaged way to save for qualified education expenses (K-12 tuition, college, etc.). While you may already know about year-end contributions, some states allow you to contribute after December 31st and still claim the deduction (if offered) on your 2025 state income tax return.
Which States?
Currently, Georgia, Indiana, Iowa, Mississippi, Oklahoma, South Carolina, and Wisconsin all offer this flexibility. If you reside in one of these states, you may still be able to reduce your 2025 state tax bill with a timely 529 contribution.
Pro Tip:
Check your specific state’s rules and contribution deadlines, as each has different limits and requirements. It’s also wise to confirm whether your 529 plan contributions are fully deductible or only partially deductible at the state level.
Your Next Steps (TL;DR)
Even if December 31st has come and gone, you might still have time to reduce your 2025 taxes before filing. Here’s a quick recap:
IRA or Roth IRA: Contribute until April 15, 2026.
Solo 401(k), SEP, or Employer 401(k): Key deadlines vary by entity type; extensions may apply.
HSA: Contribute by the April 15, 2026 filing deadline—no extensions!
529 Plan: In select states, contributions made after 12/31 can still apply to 2025 taxes.
Final Thoughts on How to Lower Your 2025 Taxes Before Filing
Tax laws can be complex, and timelines often vary based on your personal circumstances. Still, you don’t have to write off those missed year-end moves just yet. By acting swiftly, before April 15, 2026, or your extended filing deadline, you can potentially give your 2025 tax bill a final haircut and set yourself up for future financial success.
Disclosure:
All written content on this site is for informational purposes only.Opinions expresses herein are solely those of Savor Financial, a Core Planning brand.All information and ideas should be discussed in detail with your individual advisor prior to implementation. Investment advisory services are offered through Core Planning, LLC.The presence of this website on the internet shall in no direct or indirect way be construed or interpreted as a solicitation to sell or offer to sell investment advisory services.The information contained here is general in nature and is not intended as legal, tax, or investment advice. Further, the information contained herein may not be applicable to, or suitable for, the individuals’ specific circumstances or needs and may require consideration of other matters.CP does not provide legal advice or drafting services. Estate planning is considered incidental within the context of a financial plan. We will coordinate with your family attorney of choice. CP is not a certified public accountant and does not provide tax filing services. Tax related advising is considered incidental within the context of a financial plan. We will coordinate with your CPA of choice.