In partnership with
Key Highlights:
This guide breaks down six (6) simple yet powerful investment-retirement tax strategies that could save you hundreds or even thousands of dollars when filing your 2025 taxes.
Important Tax Changes for 2025
Before diving into specific strategies, it's important to know what's changed for the 2025 tax year. Several updates could affect your tax planning:
The age for Required Minimum Distributions (RMDs) has increased to 73 for individuals who turned 72 after December 31, 2022
Contribution limits for 401(k) plans have increased to $23,500 for 2025
IRA contribution limits remain at $7,000 for 2025
Catch-up contributions for those 50 and older are now indexed to inflation
The income phase-out range for Roth IRA contributions has increased to $150,000–$165,000 for single filers
These changes create new opportunities to save on taxes while building your retirement nest egg. Let's explore six strategies you can use right now.
Strategy 1: Maximize Your IRA Contributions
One of the simplest 2025 tax saving strategies is to contribute as much as possible to your Individual Retirement Account (IRA). For 2025, you can contribute up to $7,000 to your traditional IRA, or $8,000 if you're 50 or older.
When you contribute to a traditional IRA, you may be able to deduct that amount from your taxable income. This means if you contribute $7,000, you could reduce your taxable income by $7,000, potentially saving hundreds in taxes depending on your tax bracket.
The best part? You have until the tax filing deadline (usually April 15, 2026) to make contributions for the 2025 tax year. This gives you extra time to save and reduce your tax bill even after the calendar year ends.
Remember: Your ability to deduct traditional IRA contributions may be limited if you or your spouse are covered by a workplace retirement plan and your income exceeds certain levels.
Trump's 2025 Tax Bill for Taxpayers
Make tax time easier by getting to know Trump's 2025 tax updates. Be ready! This hyperlinked, easy-to-read 17-page informational tax resource will provide clarity in the most key areas: No tax on T...
Strategy 2: Consider Roth vs. Traditional IRA Tax Benefits
Choosing between a Roth IRA and a traditional IRA is an important decision that can affect your taxes now and in retirement. Here's how they differ:
Traditional IRA
Contributions may be tax-deductible now
Pay taxes when you withdraw in retirement
Good if you expect to be in a lower tax bracket in retirement
Required minimum distributions starting at age 73
Roth IRA
Contributions are not tax-deductible
Withdrawals in retirement are tax-free
Good if you expect to be in a higher tax bracket in retirement
No required minimum distributions
For 2025, the income phase-out range for Roth IRA contributions is $150,000–$165,000 for single filers and $236,000–$246,000 for married couples filing jointly. If your income is below these thresholds, a Roth IRA might be a good option for tax-free growth.
Hands Down Some Of The Best 0% Intro APR Credit Cards
Balance Transfer cards can help you pay off high-interest debt faster. The FinanceBuzz editors reviewed dozens of cards with 0% intro APR offers for balance transfers and found the perfect cards.
Take a look at this article to find out how you can pay no interest on balance transfers until 2027 with these top cards.
Strategy 3: Use Tax-Loss Harvesting for Investments
Tax-loss harvesting is a powerful strategy that can help reduce your tax bill by offsetting capital gains with capital losses. Here's how it works:
Review your investment portfolio for any investments that have decreased in value
Sell those investments to realize the losses
Use those losses to offset any capital gains you've realized during the year
If your losses exceed your gains, you can use up to $3,000 of the excess to reduce your ordinary income
Carry forward any remaining losses to future tax years
Important: Be aware of the "wash-sale rule." If you sell an investment at a loss and buy the same or a "substantially identical" investment within 30 days before or after the sale, you cannot claim the loss for tax purposes.
This strategy works best when done before the end of the tax year, giving you time to identify losing investments and make strategic decisions about which ones to sell.
How to Save Money with Schedule A Itemized Tax Deductions
What is Schedule A? How does it save me tax dollars? If you want to maximize your Schedule A tax deductions, look no further! This resource explains nearly 20 tax scenario examples! Whether you're ...
Strategy 4: Leverage Health Savings Accounts (HSAs) for Investments
Upgrade Below to get the full details of this informative tax article!
Complete Tax Newsletter + Ask Any Tax Question!
Receive ongoing News & Resources twice per week + Get Tax Support! Questions? Concerns? Advice? Business or Personal. For tax support contact email: [email protected]
Unlock NowA subscription gets you:
- Complete Tax Newsletter
- Ask Any Tax Question!
- 50% OFF the "Entrepreneur's #1 Starter Tax Guide"
