Strategies for Year-End Tax Planning – Part 1 

Six Things You Should Know

1. Equity Markets – were down this week with U.S. stocks (S&P 500) declining -0.26% while international stocks (EAFE) fell -0.23%.
2. Fixed Income Markets – were mixed this week with investment grade bonds (AGG) up +0.50% and high yield bonds (JNK) down -0.19%.
3. Weak Jobs Report – The latest jobs report showed the U.S. economy added just 22,000 jobs in August and saw a downward revision to June’s figure to -13,000, the first negative month in employment since December 2020. The unemployment rate also ticked higher to 4.3%, the highest level since 2021. 
4. Fed Confirmations – Despite grilling from Senate Democrats in appears President Trump’s nominee, Stephen Miran, will likely be confirmed to fill a vacant seat on the Federal Reserve board following the departure of Fed Governor Adriana Kugler. Miran currently serves as chairman of the President’s Council of Economic Advisors, sparking concerns about Miran’s partiality. 
5. Cybersecurity Reminder- Scammers are increasingly using Remote Access Tools (RATs) along with phishing emails or texts to take control of devices like phones, tablets, and computers. Once installed, these tools can give cybercriminals access to sensitive information, including your Schwab accounts. These attacks can be hard to spot, so if something doesn’t feel right- like unusual account activity or suspicious messages- trust your instincts. If you sense suspicious activity, please call us immediately or report any concerns to Schwab at 800-515-2157. 
6. Key Insight – [VIDEO & ARTICLE] As the 2025 tax year draws to a close, financial advisors and clients alike are seeking smart, actionable strategies to optimize their financial outcomes. This week, we discuss “3 Ideas” for this upcoming tax season.

Insights for Investors

By Jon Heideman & Daryl Geffken

Strategies for Year-End Tax Planning – Part 1 

In the current financial landscape, the responsibilities of an advisor (should) extend well beyond transactional interactions.  

Services such as asset allocation, behavioral coaching, customized family wealth planning, and tax-smart planning/investing demonstrate the importance of engaging a trusted partner who is committed to serving your best interests and enhancing value for you and your family.  

This week’s commentary will address Part 1 of our tax-efficient planning concepts as the 2025 tax year concludes. Both financial advisors and their clients are seeking effective, actionable strategies to optimize financial results. Presented below are three ideas for the upcoming tax season. 

Three Ideas to Optimize Your Tax Planning 

1. Donate Appreciated Non-Cash Assets Instead of Cash 

One of the most tax-efficient ways to support charitable causes is by donating appreciated non-cash assets. These include publicly traded securities, restricted stock, private business interests, and real estate. By donating these assets directly to a qualified charity, donors can: 

• Maximize their charitable impact 

• Help minimize their tax liability 

• Eliminate capital gains taxes, which typically range from 15% to 20% for long-term holdings 

This strategy is particularly effective for individuals with highly appreciated assets who are looking to reduce their taxable income while supporting philanthropic goals. This approach can significantly enhance the value of charitable contributions, especially for younger investors not in QCD age. 

2. Consider Tax-Loss Harvesting 

Tax-loss harvesting is a helpful tool for investors to reduce their tax burden while maintaining a balanced portfolio. The process involves selling underperforming investments to realize a loss, which can then be used to offset capital gains and up to $3,000 of ordinary income. 

Key steps include: 

• Selling a losing investment 

• Using the loss to offset gains or income 

• Reinvesting in a different security that aligns with the investor’s strategy 

However, investors must be cautious of the wash-sale rule, which disallows the deduction if the same or a substantially identical security is repurchased within 30 days. Additionally, tax-loss harvesting is not applicable in retirement accounts like IRAs or 401(k)s, where losses cannot be deducted. 

3. Roth IRA Conversion 

Roth IRA conversions can be a strategic move for individuals anticipating higher tax brackets in retirement, seeking to diversify their tax exposure, or overall estate planning. Converting traditional IRA funds to a Roth IRA involves paying taxes on the converted amount now, with the benefit of tax-free withdrawals later. 

Ideal candidates for Roth conversions include those who: 

• Expect higher future tax rates 

• Want to maximize estate planning benefits 

• Have lower-than-usual income this year 

• Seek tax diversification across accounts 

However, this strategy may not be suitable for individuals nearing retirement or lacking funds to cover the conversion tax. It’s also less favorable for those planning to use Qualified Charitable Distributions (QCDs) from their traditional IRAs. 

Working with a financial advisor can provide structure and guidance for your financial planning. Advisors assist clients with diversified investment strategies, help manage responses to market changes, and develop plans based on individual family goals and values. By including tax-efficient approaches, advisors may improve overall financial outcomes, with studies estimating total value added at roughly 4.87% annually in 2025. (Russell Investments, August 2025) 

At TEN Capital, we work with our clients to refine their financial and estate plans and implement these strategies. If you have any questions or would like more information about any of the topics we discussed, please reach out to your advisor. We are here for you and those that you care about.  

Have a wonderful weekend,  

Jon, Daryl, and the team at TEN Capital.  

Data, Just the Data

• U.S. Jobless Claims – initial claims rose by 8,000 last week for a total of 237,000, the highest level in two months. Meanwhile, outstanding claims fell for a second straight week to 1,940,000, the lowest in five months. 
• Eurozone Retail Sales – fell by 0.5% in July following June’s 15-month high. This marks the sharpest monthly decline in two years.  

• U.S. ISM Manufacturing PMI – rose to 48.7 in August but remained in contractionary territory and weaker than expected. Survey respondents overwhelmingly pointed to tariffs as a drag on business conditions, citing higher costs, supply chain disruptions, and reduced competitiveness.  
• U.K. Manufacturing PMI – fell to 47 in August for the 12th consecutive month of contraction. The gauge noted lower production, a drop in new orders, and a rise to costs.