With the holiday season behind us, many clients are looking forward to their financial goals for the new year.
In fact, the sooner that clients begin evaluating their options and the changes that 2026 will bring, the greater the likelihood that they’ll achieve those goals. While many transactional deadlines aren’t until year-end, other deadlines arrive in a few months — and many clients may benefit from a more structured approach throughout the year.
While each client’s financial picture is different, early planning and a checklist-like approach to evaluating available options can be the key to achieving retirement planning goals in 2026.
Required Minimum Distributions
Clients who turned 73 during the 2025 tax year have until April 1 to take their first required minimum distribution from traditional individual retirement accounts and company-sponsored 401(k)s.
Clients who turn 73 in 2026 will be required to take their first RMD by April 1, 2027. Those clients, though, should be advised that if they wait until 2027, they’ll also be required to take their 2027 RMD by Dec. 31, 2027. That’s because the three-month grace period applies only for the first RMD year.
Taking two distributions in one year will result in higher tax liability during that single year assuming that the client doesn’t anticipate dropping into a lower tax bracket during 2027.
To calculate the 2026 RMD amount, clients divide their account balance as of Dec. 31, 2025, by the life expectancy factor contained in the IRS Uniform Lifetime Table. RMDs for IRAs and 401(k)s are calculated separately, and clients should be advised that they may be entitled to delay 401(k) RMDs if they continue to work for the employer sponsoring the plan.
Clients looking to reduce the tax effects of their RMD obligations may wish to explore the qualified charitable distribution option. This allows clients to use their RMD funds to accomplish their charitable goals — and when the requirements of the QCD provisions are met, those amounts can be excluded from taxable income.
Contributions and Conversions
Taxpayers can continue to make 2025 contributions to IRAs until the April 15 tax filing deadline. Of course, they can also start making their 2026 IRA contributions. For 2026, the applicable contribution limit increased to $7,500, plus a $1,100 catch-up contribution for taxpayers aged 50 and older.
Contributions to 401(k)s for 2026 are limited to $24,500 for standard contributions, with an additional $8,000 catch-up contribution for those 50 and older. Taxpayers should also be reminded about the new Secure 2.0 Act “super” catch-up contribution for 2026 of $11,250 for taxpayers aged 60-63.
Taxpayers should also be advised about the benefits of funding a Roth IRA to create a tax-free source of income during retirement. Roth conversions are entirely taxable, and no prior-year conversions are permitted. Any conversions executed during 2026 will be included in the client’s taxable income.
Clients can execute multiple Roth conversions in a single year, so they may consider converting when asset values are depressed to minimize tax liability. In addition, no age limits or penalty taxes apply to conversions — clients making the conversion must include only the amount converted in their taxable income for the conversion year.
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