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What Tax Advisers Want You to Do Before Year-End—And Why It Actually Matters

MarketDash Editorial Team
21 days ago
The 2026 tax season brings significant shifts: no free Direct File program, expanded standard deductions, a new senior bonus deduction, and altered charitable giving rules that could change how you plan donations.

If you've been putting off year-end tax planning, now might be the time to stop procrastinating. The 2026 filing season is shaping up to be notably different, and tax professionals say making moves before December 31 could save you real money.

Why CPAs Are Sounding the Alarm

"Taking action before the end of this year can be a huge benefit to your financial health in 2026," said Dan Snyder, director of personal financial planning at the American Institute of CPAs. He points to "many changes in the tax and financial planning space this year" that warrant early attention.

The Free Filing Option Just Disappeared

Here's an interesting twist: the IRS is scrapping its free Direct File system after only two seasons. Treasury Secretary Scott Bessent defended the move by saying the program "wasn't used very much" and claiming "the private sector can do a better job." The reality? Nearly 300,000 taxpayers used Direct File for 2025 returns—more than double the prior year—and satisfaction scores topped 90%. Taxpayer advocates worry the change will force low-income filers back toward paid software, but the decision is final.

Bigger Deductions Across the Board

The One Big Beautiful Bill Act is reshaping how deductions work for 2025 and 2026. The standard deduction jumps to $31,500 for married couples filing jointly in 2025, then climbs again to $32,200 in 2026. Single filers see smaller but still meaningful increases.

More interesting is the new "senior bonus" deduction. Adults 65 and older can now claim an extra $6,000 per person through 2028. AARP describes it as meaningful but warns the benefit comes with income phaseouts that add complexity.

Charitable Giving Gets More Strategic

The charitable deduction rules are changing in ways that might alter your giving strategy. Starting in 2026, non-itemizers can deduct up to $1,000 in cash donations to eligible charities—$2,000 for couples filing jointly. That sounds nice, but there's a catch for itemizers: donations now face a new floor of 0.5% of adjusted gross income before they become deductible.

Since the Tax Foundation estimates nearly 86% of filers will still take the standard deduction, CPAs are suggesting a strategy called "bunching"—concentrating several years worth of charitable gifts into one year to clear the new threshold and make itemizing worthwhile.

Retirement Accounts and Auto Loans Offer New Opportunities

Other planning tools are shifting too. IRS inflation adjustments push 401(k) contribution limits to $24,500 in 2026, with higher catch-up contributions for workers over 50. New rules will eventually require high earners to direct their catch-up contributions into Roth accounts.

And here's something unusual: the new law creates an auto-loan interest deduction. Qualifying buyers of U.S.-assembled cars can deduct up to $10,000 in interest, though income caps apply. It's not quite the mortgage interest deduction for vehicles, but it's a notable new lever for people shopping for American-made cars.

The bottom line? Tax season 2026 isn't just another year. Between the loss of free filing, expanded deductions, and new giving rules, there are genuine opportunities to save—if you plan ahead.

Back to News

What Tax Advisers Want You to Do Before Year-End—And Why It Actually Matters

MarketDash Editorial Team
21 days ago
The 2026 tax season brings significant shifts: no free Direct File program, expanded standard deductions, a new senior bonus deduction, and altered charitable giving rules that could change how you plan donations.

If you've been putting off year-end tax planning, now might be the time to stop procrastinating. The 2026 filing season is shaping up to be notably different, and tax professionals say making moves before December 31 could save you real money.

Why CPAs Are Sounding the Alarm

"Taking action before the end of this year can be a huge benefit to your financial health in 2026," said Dan Snyder, director of personal financial planning at the American Institute of CPAs. He points to "many changes in the tax and financial planning space this year" that warrant early attention.

The Free Filing Option Just Disappeared

Here's an interesting twist: the IRS is scrapping its free Direct File system after only two seasons. Treasury Secretary Scott Bessent defended the move by saying the program "wasn't used very much" and claiming "the private sector can do a better job." The reality? Nearly 300,000 taxpayers used Direct File for 2025 returns—more than double the prior year—and satisfaction scores topped 90%. Taxpayer advocates worry the change will force low-income filers back toward paid software, but the decision is final.

Bigger Deductions Across the Board

The One Big Beautiful Bill Act is reshaping how deductions work for 2025 and 2026. The standard deduction jumps to $31,500 for married couples filing jointly in 2025, then climbs again to $32,200 in 2026. Single filers see smaller but still meaningful increases.

More interesting is the new "senior bonus" deduction. Adults 65 and older can now claim an extra $6,000 per person through 2028. AARP describes it as meaningful but warns the benefit comes with income phaseouts that add complexity.

Charitable Giving Gets More Strategic

The charitable deduction rules are changing in ways that might alter your giving strategy. Starting in 2026, non-itemizers can deduct up to $1,000 in cash donations to eligible charities—$2,000 for couples filing jointly. That sounds nice, but there's a catch for itemizers: donations now face a new floor of 0.5% of adjusted gross income before they become deductible.

Since the Tax Foundation estimates nearly 86% of filers will still take the standard deduction, CPAs are suggesting a strategy called "bunching"—concentrating several years worth of charitable gifts into one year to clear the new threshold and make itemizing worthwhile.

Retirement Accounts and Auto Loans Offer New Opportunities

Other planning tools are shifting too. IRS inflation adjustments push 401(k) contribution limits to $24,500 in 2026, with higher catch-up contributions for workers over 50. New rules will eventually require high earners to direct their catch-up contributions into Roth accounts.

And here's something unusual: the new law creates an auto-loan interest deduction. Qualifying buyers of U.S.-assembled cars can deduct up to $10,000 in interest, though income caps apply. It's not quite the mortgage interest deduction for vehicles, but it's a notable new lever for people shopping for American-made cars.

The bottom line? Tax season 2026 isn't just another year. Between the loss of free filing, expanded deductions, and new giving rules, there are genuine opportunities to save—if you plan ahead.