Retirees advised to make strategic tax moves now to reduce taxes next year

From Yahoo Finance: 2025-04-16 11:42:00

As the 2024 tax year comes to a close, retirees are advised to start planning for next year’s return. Managing retirement accounts this April will impact future tax bills. The recent market gains mean higher required minimum distributions (RMDs) for many. Consider Roth conversions and qualified charitable distributions to optimize tax strategies.

With the potential for higher tax rates in 2025, retirees are exploring Roth conversions to lock in lower rates. Timing is crucial, and the decision is permanent. Additionally, consider energy-efficient home improvements and investing in tax-exempt bonds for tax benefits. Seek advice from financial professionals to maximize tax strategies.

Retirees turning 73 this year face RMD obligations that may impact taxable income. Taking RMDs sooner rather than later can help manage future tax bills. Evaluate smaller moves like Roth conversions, qualified charitable distributions, and other tax strategies to optimize retirement savings. Plan now to protect your finances in the future.

Read more: Money moves retirees can make now to reduce next year’s taxes