By Robert E. Quittner, Jr. CFP® & CMFC™
Investment Advisor Representative
[email protected]
Today our office is closed in observance of Juneteenth. While there are 10 other major holidays that Americans observed for many years such as New Years Day, Martin Luther King Jr. Day, Memorial Day, and Fourth of July to name a few, Juneteenth is a relative newcomer.
So, what exactly is Juneteenth and why is it important today? Juneteenth commemorates June 19, 1865, when Union troops arrived in Galveston, TX and announced that enslaved people in Texas were free, more than two years after the Emancipation Proclamation. It’s a reminder that legal rights and freedoms are not always implemented immediately or equally.
For many Americans, it serves as a day to learn about U.S. history, honor the resilience and contributions of African Americans, and reflect on the nation’s ongoing pursuit of equal opportunity and justice. Juneteenth became a federal holiday in 2021 after decades of advocacy, particularly from African American communities and activists who sought national recognition of the end of slavery in the United States.
Since we are halfway through the year it’s a good time to review your 2026 tax plan and ensure it is on track. Many people assume tax planning happens when they file their tax return each spring. The reality is that the most valuable tax-saving opportunities often occur before year-end, well before most folks start preparing their tax return.
The importance of proactive planning has only increased since the Tax Cuts and Jobs Act nearly doubled the standard deduction. Prior to the law’s enactment, roughly 70% of taxpayers claimed the standard deduction. With the passing of that law and the recent additions of the OBBBA—namely, the additional $6,000/person Senior Bonus—approximately 90% of taxpayers use the standard deduction today. As a result, many traditional tax deductions that once drove tax planning provide little or no benefit for most people. Odds are if you have used the standard deduction the last several years you’ll use it again this year.
With half the year behind us, now is an ideal time to review your projected income, tax withholding, and estimated tax payments to determine whether there are adjustments you may need to make before year-end.
Listed below are several items you might consider reviewing:
- Have you paid enough taxes so far?
People receive income from numerous sources such as Social Security, pensions, IRA distributions, rental income and investments. Taxes are not always automatically withheld so a mid-year review can help identify whether additional withholding or estimated tax payments may be needed to avoid underpayment penalties. - Are Roth conversions in your plan? Should they be?
If you’re planning Roth conversions this year, now is a good time to estimate your projected income and determine how much room remains in your current tax bracket. I’ll often recommend Roth conversions during the year and then in December check your limit again. - Are You Approaching an IRMAA Threshold?
Medicare Part B and Part D premiums increase when income exceeds certain levels. Reviewing your projected income now may help avoid unexpectedly crossing into a higher Medicare premium bracket. - Where do you stand with your Required Minimum Distributions (RMDs)?
The average middle-income retiree has 70% to 90% of their savings in traditional tax-deferred accounts which require RMDs. Are you already taking RMDs or taking them for the first time this year? If so, have you calculated them into 2026 total income and accounted for the taxes? - Have there been any major changes this year?
Marriage, widowhood, large capital gains, inherited accounts, business income, property sales, or changes in charitable giving and Roth conversions will all impact your tax picture. Have you accounted for them in your tax plan? - Did you turn on any new income streams this year?
Pensions, Income riders on annuities or Social Security. If so, is the proper percentage of taxes being withheld? - Any capital gains advantages to be had?
Review your gains and losses in your non-qualified accounts to take advantage of any tax harvesting opportunities. Remember the concept of tax-loss harvesting and offsetting gains with losses. It may make sense to dump some losing stocks to minimize the tax hit of selling a winner with big gains. - Any update on your charitable giving?
Qualified Charitable Distributions (QCDs) might make sense this year depending upon your age and tax situation. A Qualified Charitable Distribution (QCD) allows individuals age 70½ or older to transfer up to $111,000 annually (2026 limit) per person, directly from an IRA to a qualified charity. The distribution is excluded from taxable income and can satisfy all or part of a Required Minimum Distribution (RMD) for those subject to RMD rules. - Tax-Efficient withdrawal sequencing
Given the other strategies and circumstances mentioned above you might consider adjusting your income from your taxable accounts for the remainder of the year to control your taxable income.
In closing, and not to belabor a point, mid-year is a great time to make tax plan and withholding adjustments. There is still plenty of time to implement strategies, but enough of the year has passed to accurately estimate income and taxes.
If you’d like Peter, Jeremy, Nick, Kyle, or me to review what you’ve done so far in 2026 and determine whether any of these tweaks make sense, or evaluate your withholding and estimated tax payments, please reach out. A brief tax planning conversation today could help avoid an unpleasant surprise next April.
Enjoy your weekend and Happy Father’s Day to all the fellow dads out there!
Rob