4 Tax Moves You Can Still Make in Your 60s That Matter

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It’s easy to assume that the opportunities to optimize your taxes are behind you by the time you hit your 60s. That’s not true because this decade offers some great ways to help your tax planning, especially if you still have a steady income source and are close to retirement. 

The idea is to focus on moves that will help lower taxes now or to prevent larger tax bills later on. Here are tax strategies you can still make that matter and why they can have a huge impact. 

Max Out Catch-Up Retirement Contributions 

Contributing to retirement accounts is still one of the most direct ways to lower your tax bill right now. That’s because you can put pre-tax dollars into them, lowering your taxable income. 

The 401(k) contribution limit is $24,500, with the IRS stating that workers age 50 and older can put in an additional $8,000 as a catch-up contribution. 

For traditional IRAs, contributions are now $7,500 for 2026, plus a $1,100 catch up for those age 50 and over. 

Take Advantage of Roth Conversions

A Roth conversion is where you roll over funds from a retirement account with pre-tax dollars into a Roth one. Because Roth accounts are funded with post-tax dollars, you will need to pay taxes on the amount you convert.

There are a few advantages to making a partial Roth conversion, one of which could be paying taxes later. Accounts like traditional IRAs and 401(k) plans are subject to required minimum distributions (RMDs) and start at age 73 for most retirees. 

Once they start, you could pay more taxes because the amount you withdraw is now considered taxable income. Roth IRAs, however, are not subject to RMDs during the account owner’s lifetime. Plus, you’ve already paid taxes when you made the conversion, so in most cases you won’t have to do so again.

Converting smaller amounts during your lower income years could mean that you won’t have to pay as much later on. 

Control How Much of Your Social Security Gets Taxed

Your Social Security benefits aren’t always tax free. Depending on your income, up to 85% of your benefits may be taxable.

According to the IRS, your combined income could mean that your Social Security benefits may be taxed. This includes your adjusted gross income, plus half of your Social Security benefits and nontaxable interest you receive. 

Once your income exceeds a base amount based on your filing status, benefits become partially or mostly taxable.

This is where planning in your 60s matters. It might take a bit of planning, but strategies like Roth conversions and managing your withdrawals and income for when you claim Social Security can help limit how much of those benefits are taxed later.

Play Around With RMDs 

RMDs from traditional retirement accounts could raise you into a higher tax bracket if you’re required to make withdrawals that are higher than the income you’ve made previously. 

Aside from Roth conversions, you can consider drawing down these accounts as soon as you retire to help lower the amount of RMDs you need to make. Or, if you can afford to do so, delay Social Security benefits. It might be a smart move to work with a financial professional to see where it makes sense to withdraw accounts and when to help make the most out of your tax situation. 

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