Dec. 30, 2025, 12:34 p.m. ET
Don’t ring in the new year until you have milked 2025 for every tax savings you can. Yes, there are still savings to be had but you have less than 48 hours to grab them.
Below is a list of the best tips from experts for tax savings before saying goodbye to 2025.
A tax break only available for 2 days
Thanks to the the SECURE 2.0 Act of 2022, if you’re under 59-1/2 years old, you can take up to $2,500 from a retirement plan to pay qualified long-term care insurance premiums without a 10% early withdrawal penalty.
The distribution, however, will still be taxed as income and must be made after Dec. 29. That leaves only two days to do it – Dec. 30 and 31 – before the new year begins, said Richard Pon, certified public accountant in San Francisco.
Last and final call for these tax breaks, forever
The residential clean energy credit and energy-efficient home improvement credit are only available through Dec. 31.
- Residential clean energy credit: Equal to 30% of the cost of installation of certain energy items like solar cells, small wind turbines or battery storage if done before year-end.
- Energy efficient home improvement credit: Homeowners can take credit for 30% of the costs of qualifying energy-efficient improvements, including windows, doors, insulation and HVAC systems if in service by Dec. 31.
Catch-up contributions to 401(k) plans
Individuals age 50 or older at the end of the calendar year can make annual catch-up contributions to their 401(k) plans, but they must be made by Dec. 31.
All individuals age 50 or older, except those age 60 to 63, can contribute an additional $7,500. Those who are 60 to 63 can make a “super” catch up contribution of $11,250 .
Contributions to 401(k) accounts are made with pre-tax dollars, which effectively lowers taxable income when tax time comes around. Instead, withdrawals will be taxed.
If you save in an IRA, the $1,000 catch-up can be made up to the tax filing deadline, typically April 15, for the 2025 tax year.
Itemizers, be generous
Non-itemizers should wait to give until after the new year, when they can claim a deduction for cash donations of up to $1,000 for single filers and $2,000 for couples filing jointly. Anything doled out in 2025 gets no deduction.
In contrast, itemizers should give generously by Dec. 31 to maximize their gifts. Next year, only charitable contributions that exceed 0.5% of a taxpayer’s adjusted gross income are deductible. So, say your AGI is $200,000, the first $1,000 in donations isn’t tax-deductible.
Those in the top 37% tax bracket next year will only receive a 35% tax benefit from all itemized deductions, not just charitable contributions. This means a $10,000 donation will receive a tax benefit of $3,500, instead of $3,700 this year.
Medora Lee is a money, markets and personal finance reporter at USA TODAY. You can reach her at mjlee@usatoday.com and subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday morning.
