Five Things To Put On Your Year-End Finance Checklist

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The end of the year is busy with holidays and family vacations – but it's also a time to review your finances and what you need to do, offset, claim, buy or pay before deadlines pass. Our checklist helps you gauge what you need to do before 2023 comes to a close.

Fund Health Savings Account (HSA)

Those in high-deductible health-insurance plans can put away as much as $3,850 before taxes. For families, the figure is $7,750. However, individuals aged 55 and older can contribute an additional $1,000, increasing the limit to $4,850 (individual) and $8,750 (family)¹.

Spend Flex Dollars

Unused funds in Flexible Spending Accounts are typically forfeited at year's end, so make sure to tap them for eligible health- and-medical expenses by Dec. 31. Check with your employer to confirm your plan's deadlines, as some plans don't follow the calendar year. There are two exceptions that may apply: FSA regulation provides for either a maximum of $610¹ to roll over (the amount may vary from plan to plan); or, a 2½ month grace period to use the carryover portion. Plan sponsors may only offer one or the other. Check with your sponsor to find out³.

Reduce Capital Gains Taxes

Any capital losses you realize before Dec. 31 can be used to offset your gains. If your net losses exceed your gains, you can offset an additional $3,000 of ordinary income; any losses beyond that limit can be carried forward to future tax years². This is known as “Tax Loss Harvesting.”

Take Required Minimum Distributions (RMDs)

In 2023, the SECURE Act 2.0 increased the required age to take Required Minimum Distributions (RMDs) to 73 1/2³ from certain retirement accounts by Dec. 31 – or face a penalty equal to 50% of the sum you failed to withdraw. If you turned 73 1/2 this year, you have until April 1, 2023, to take your first RMD.

Contribute to a 529 Plan

Such contributions must be made before the end of 2023 in order to take advantage of any state-income-tax benefits (or to be eligible for the federal gift-tax exclusion of $17,000 per donor, per individual donated to). For instance, in 2023 a mother and father could each gift $17,000 to their child, equaling $34,000 total, without incurring gift taxes⁴.

Questions?

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