Let’s face it: nobody enjoys thinking about next April’s tax return (with the possible exception of your CPA). The problem is, once the year turns over a new page, it’s too late to take advantage of some of the tax moves that have potential to save you serious money during the next filing season. In other words, a little planning on your part now can make next April feel a lot calmer, not to mention less expensive.
Many of these year-end tax planning tips are of the common-sense, “defer income / accelerate deductions” variety. But especially for high-earning executives, professionals, and business owners in New Jersey and New York, this is an important time window—and your last chance—to review your income, withholding, gifting, and other financial processes between now and December 31 (assuming your business operates on a calendar year). Likewise, bonus depreciation
What can I still do in Q4 to lower this year’s taxes?
If you are participating in or own a traditional (pre-tax) retirement account (IRA, 401(k), 403(b), etc.), you should maximize contributions by the end of the year; in addition to giving you a break on federally taxable income, contributions to traditional tax-advantaged plans also could reduce your liability for the high state and local taxes assessed in New Jersey and New York.
Business owners who intend to use Section 179 expensing for qualifying equipment and tech purchases should make sure these items are placed into service before the end of the year. Likewise, property qualifying for bonus depreciation must be purchased, ready, and available for its intended use by the end of your business year. Don’t forget that the One Big Beautiful Bill Act (OBBBA)1 makes 100% bonus depreciation permanent for property placed in service after January 19, 2025; if you have qualifying assets, you don’t want to miss out on this opportunity.
How does the timing of my bonus affect my tax bill?
And speaking of bonuses, if you’re a top-performing executive who qualifies for a bonus this year, you should investigate the possibility of deferring receipt until after December 31, thus moving the taxable income into next year. A large year-end payout could easily shove you into a higher marginal bracket, but pushing the bonus into the next year can give you time to do some additional planning to potentially mitigate the tax effects. If you’ve got access to a nonqualified deferred compensation (NQDC) plan, it could help you avoid constructive receipt issues that could complicate your tax planning for the current year.
What is charitable bunching and when does it make sense?
If charitable gifting is part of your overall financial and tax strategy, now is the time to review your total for the year so far: how much you’ve given, which charities you’ve addressed and which ones you still intend to benefit, and especially asset-specific timelines (allowing for the extra time needed to transfer non-cash assets like appreciated securities, real estate, etc.). If your annual itemized deductions fall close to the standard deduction threshold (in 2026, $16,100 for a single individual, $32,200 for a married couple filing jointly),2 consider bunching multiple years of charitable contributions into a single tax year to clear the itemization hurdle, then take the standard deduction in alternate years. Note, however, that with OBBBA, only charitable gifts above 0.5% of your adjusted gross income are deductible for itemizers (e.g., for taxpayers with $600,000 in adjusted gross income (AGI), the first $3,000 in charitable giving provides no deduction).3
While we’re on the topic of charitable bunching, remember that a donor-advised fund (DAF) can tremendously simplify your charitable gifting, especially if you want to group several years’ donations into a single year, or if you have non-cash assets to donate. Most DAFs can accept not only cash, but also appreciated securities, real estate, collectibles, and even private business interests. The DAF can accept your gift, providing you with charitable deduction equal to the fair market value at the time of the gift. Then, the DAF can liquidate the assets as necessary and distribute the proceeds to the qualified charity you choose to support.
Especially if you’ve had a “bumper year,” income-wise, charitable bunching could allow you to get a larger deduction than the standard amount and support the causes that matter most to you at the same time. Plus, giving appreciated assets can potentially save you thousands in capital gains tax liability that you would otherwise accrue.
How can business owners reduce taxes in New Jersey and New York?
If you own a pass-through business (S-corp, partnership, LLC, sole proprietorship) and your modified adjusted gross income (MAGI) is in the SALT deduction phase-out zone ($505,000+ for single and joint filers), you’ve hopefully already considered electing the pass-through entity tax (PTET; also known as the business alternative income tax, or BAIT) for New Jersey or New York. This allows the business to pay state tax at the entity level, potentially bypassing or mitigating the federal SALT deduction limitation. You must make this election by March 15 of the year for which taxes are payable and estimated payments are due throughout the year, so if you missed it this year, make this discussion part of your year-end meeting with your tax advisor so you can be ready for next year.4
When should I harvest investment losses?
Let’s not forget about tax-loss harvesting: one of the few situations in life where losing can actually make you a winner. Between now and the end of the year, sit down with your financial advisor and review your portfolio for investments that may have underperformed (even in good market years, there are usually a few of these). By selling “underwater” investments and recognizing the loss, high-earning taxpayers may be able to create losses that can be used to offset gains in other areas. Such tax-loss harvesting can be an important tool for managing capital gains tax liability, and it can also save you money when the time comes for rebalancing the portfolio.
How can high earners control AMT and NIIT exposure?
Most high earners, beyond being concerned about their marginal bracket, must also consider their exposure to the alternative minimum tax (AMT) and net investment income tax (NIIT). Especially for executives who have exercised incentive stock options and continue to hold highly appreciated stock, the AMT becomes a high liability. And the NIIT can add a 3.8% surtax to the lesser of your net investment income (NII) or the amount by which your MAGI exceeds specific statutory thresholds ($200,000 for single filers; $250,000 for married couples filing jointly). Fortunately, there’s still time, between now and the end of the year, to utilize strategies like tax-loss harvesting and deferral of income to limit your exposure.5
Realizing capital losses before December 31 offsets your capital gains dollar-for-dollar. Because capital gains are a primary component of net investment income, shrinking those gains directly reduces the pool of income subject to the NIIT. Deferring ordinary income and/or maximizing pre-tax workplace retirement plan contributions lowers your alternative minimum taxable income (AMTI), helping to preserve your AMT exemption and potentially keeping you in the lower 26% AMT bracket rather than the 28% bracket. The Lyle Weintraub advisory team understands the importance of planning ahead of tax time to minimize your tax bill and maximize the assets working for you. Working in cooperation with your trusted tax advisor, we can help you build an investment strategy and financial plan that reflects your unique goals, resources, needs, and dreams. Contact us today to learn more about how we help investors “live wealthfully.”
SOURCES
1. US Congress, One Big Beautiful Bill Act (OBBBA), available at https://www.congress.gov/bill/119th-congress/house-bill/1/text; accessed 10/15/26; BDO USA, “One Big Beautiful Bill Act Expands 100% Depreciation Expensing Opportunities,” September 30, 2025, https://www.bdo.com/insights/tax/one-big-beautiful-bill-act-expands-100-depreciation-expensing-opportunities 2. Internal Revenue Service, “Publication 505 (2026),” available at https://www.irs.gov/publications/p505; accessed 10/15/26
3. Andrew Lautz, “How the New Charitable Deduction Floors Work,” Bipartisan Policy Center, November 17, 2025, https://bipartisanpolicy.org/issue-brief/how-the-new-charitable-deduction-floors-work/
4. Division of Taxation, State of New Jersey, “Pass-Through Business Alternative Income Tax (PTE/BAIT),” available at https://www.nj.gov/treasury/taxation/baitpte/index.shtml, accessed 10/15/26; Department of Taxation and Finance, State of New York, “Pass-Through Entity Tax (PTET),” available at https://www.tax.ny.gov/bus/ptet/, accessed 10/15/26
5. Internal Revenue Service, “Topic no. 556, Alternative Minimum Tax,” available at https://www.irs.gov/taxtopics/tc556, accessed 10/15/26; Internal Revenue Service, “Net Investment Income Tax,” available at https://www.irs.gov/individuals/net-investment-income-tax, accessed 10/15/26