Labor Day is over. Summer spending is done. The useful question for September is not “What should I do on December 29?” It is “What does 2026 already look like, and what is still left to happen?”
Every fall, the same pattern shows up. Someone rushes a large IRA distribution or a last-minute Roth conversion because the year is almost over and the move “feels right.” The tax bill arrives in April. Medicare premium increases can arrive even later. IRMAA uses a two-year lookback, so income created in 2026 can affect premiums in 2028. By then, it is easy to forget why income was higher two years earlier.
December 31 is the deadline. The work should be finished well before then.
Add up the year before you add more taxable income
A hypothetical couple, Tom and Diane, are both on Medicare. The year has been decent: Social Security, some portfolio income, and they are considering an $80,000 Roth conversion. On a napkin, the conversion looks reasonable. A relative did one, so it “must be a good idea.”
What the napkin misses is the rest of 2026: a capital gain earlier in the year, an RMD still ahead, and where they sit relative to an IRMAA cliff. One extra dollar over a threshold can move them into a higher Medicare premium tier for a full year — two years later.
That does not mean they should skip the conversion. It means they should not decide in a vacuum in the last week of December.
2026 Medicare premiums are generally based on 2024 income, so that piece is already set. What you do with income this year can still show up in 2028. That lag is why people feel blindsided.
1. Finish the year-to-date picture first
Pull last year’s tax return, this year’s income so far, retirement account statements, RMDs still due, withdrawals already taken, realized gains in taxable accounts, and any conversions already completed. You cannot judge a December move until you know what 2026 already looks like.
2. Confirm whether an RMD is still due
If you were born between 1951 and 1959, RMDs generally start at age 73. If you were born in 1960 or later, they generally start at age 75. After the first year, the deadline is December 31. Missing it can trigger a penalty.
If this is your first RMD year, you may be able to delay that first withdrawal until April 1 of the following year. That often means two withdrawals in one calendar year. Run the numbers before you delay. Also do not assume the custodian has your full picture across every account.
3. If you give to charity and you are 70½ or older, consider how a QCD might work for you.
In 2026, the qualified charitable distribution limit is $111,000 per person. A QCD is a transfer sent directly from an IRA to a qualifying public charity. If the rules are followed, that amount is excluded from taxable income and can satisfy some or all of an RMD. Writing a check from a bank account is different. Donor-advised funds generally do not qualify.
This is not right for everyone. It depends on whether you give to charity, whether you have an IRA, and whether lowering this year’s taxable income would help the plan, including IRMAA two years out. If a QCD may help after the numbers are run, start the paperwork now. Custodians get busy in late December.
4. Treat a Roth conversion as a full-year decision
A Roth conversion moves money from a traditional IRA or similar pre-tax account into a Roth. Tax is due on the converted amount now. The question is not whether everyone should convert or no one should. The question is whether paying tax at this year’s rate looks better than paying tax at a future rate, given this year’s income, future income, Medicare premiums, and what you want to leave heirs.
If, when, and how much to convert is personal. A conversion that looks fine by itself can become expensive once you add the rest of 2026 and IRMAA cliffs. That is why a financial model matters.
5. Review taxable gains and losses before the year-end rush
In brokerage accounts, look at positions with losses and positions with large gains. Tax-loss harvesting is not about abandoning a long-term plan. It is about being intentional with taxable sales before December 31. Wash-sale rules still apply.
For Tom and Diane, a large gain taken in the summer is already part of this year’s income. Ignoring it and converting more in December is how a “fine” year stops being fine.
A note for DIY investors
A spreadsheet can track balances. It usually cannot connect tax brackets, RMDs, IRMAA, Social Security taxation, and a 25- to 30-year spending plan at the same time. People often pick one idea — “I like QCDs” or “I’ll convert this year” — and miss the combined effect. A suboptimal plan often does not look like a disaster. It can look like an April tax bill you did not expect, or a Medicare premium in 2028 that you cannot connect to a December 2026 decision.
This week’s list
1. Finish the 2026 year-to-date picture.
2. Confirm whether an RMD is due and whether delaying a first-year RMD would stack two withdrawals in 2027.
3. If you give from an IRA, start QCD paperwork now.
4. Do not decide on a Roth conversion until you have seen the full-year picture, including IRMAA two years out.
5. Review taxable gains and losses before December.
6. Talk with your advisor if you want a second set of eyes.
If you want help lining this year’s income up against next year’s taxes and later Medicare premiums, book a complimentary 15-minute Fit Call: [https://calendly.com/anthony-leonardi-leonardifwc/retirement](https://calendly.com/anthony-leonardi-leonardifwc/retirement).
The [Roth IRA Conversion Playbook, 2026 Edition](ROTH Conversion Playbook) walks through conversion rules in one place. If inherited IRAs and paying tax once instead of twice is also on your list, see the [Smart Tax Shield Legacy Playbook](smart-tax-shield-legacy-playbook).
There really is A Smarter Way to Retire.
Please refer to [LeonardiFamilyWealthcare.com](https://www.leonardifamilywealthcare.com) for full disclosures and additional resources. This is educational and not tax, legal, or personalized investment advice. Tax rules, RMD ages, QCD limits, and IRMAA thresholds can change. Coordinate with your tax professional before taking action.