If your year-end tax planning conversation usually happens in December, this year is a good one to move it up. With several provisions of the One Big Beautiful Bill Act (OBBBA) now fully in effect for 2026, there’s more to model — and less time to react once the calendar turns to Q4.
A few 2026 changes worth getting ahead of:
- Charitable giving floor. Itemized charitable deductions are now only deductible above 0.5% of adjusted gross income. If you give consistently each year, “bunching” multiple years of donations into one year — or timing gifts through a donor-advised fund — may preserve more of the deduction than giving the same amount annually.
- Reduced benefit for top-bracket itemizers. Taxpayers in the 37% bracket get the value of their itemized deductions capped as if they were in the 35% bracket. This changes the math on when itemizing still makes sense.
- Business depreciation and expensing. Bonus depreciation and an increased Section 179 limit are both back in play for 2026, which affects the timing of equipment and asset purchases before year-end.
- Retirement and HSA contribution limits increased for 2026 — worth confirming payroll deferral elections are set up to capture the higher limits before December 31.
- AMT exposure has widened for some taxpayers as exemption thresholds shift, which can change the calculus on accelerating income or deductions.
Why start now instead of December:
By September, you still have time to actually act on a recommendation — adjusting a purchase timeline, revisiting an entity’s estimated payments, or restructuring a charitable gift — instead of just documenting what already happened. Waiting until December often means choosing between options that are already locked in.
A simple starting point: pull your year-to-date income, a rough Q4 projection, and a list of any planned large purchases, gifts, or asset sales. That’s usually enough for an initial planning conversation.
Get Ahead of It
Every client’s situation is different, and some of these changes interact with each other in ways that are easy to miss without a full picture of your income and entity structure. If you’d like to get a jump on year-end planning instead of waiting until the last quarter, reach out to your service team at Accavallo & Company — we’d rather help you plan in September than react in December.
Federal tax law referenced above reflects OBBBA provisions taking effect for the 2026 tax year; state tax treatment (including Connecticut) may differ and should be confirmed separately.
