Last-Minute Tax Moves to Make Before April 15

April 15 is just around the corner. If you haven't filed yet, you still have time to make moves that could meaningfully reduce your tax bill. This year's filing season comes with a host of new deductions and expanded benefits under the One Big Beautiful Bill, signed into law on July 4, 2025. Many taxpayers don't realize how much they can still do before the deadline.

Here are six actionable steps to consider before you file — including one strategy specifically for high earners that's often overlooked.

1. Claim Every New Deduction on Your Schedule 1-A

The IRS just released a new Schedule 1-A specifically to capture the landmark deductions from the One Big Beautiful Bill. For 2025 returns, this includes:

• No tax on tips: Up to $25,000 in reported tips may be deductible for qualifying service industry workers (phased out above $150,000 MAGI for individuals, $300,000 for joint filers).
• No tax on overtime: A new deduction for qualifying overtime compensation — available whether you itemize or take the standard deduction.
• Car loan interest: If you purchased a vehicle, you may be able to deduct the interest paid on your auto loan — make sure your lender provided the required statement by January 31.

If you're working with a CPA or filing on your own, make sure you're using the updated Form 1040 instructions and reviewing IRS.gov/getready for the latest checklists.

2. Max Out Your IRA Contribution

You have until April 15 to make a Traditional or Roth IRA contribution that counts toward your 2025 tax year. The contribution limit for 2025 is $7,000 ($8,000 if you're 50 or older). A Traditional IRA contribution may reduce your taxable income directly — dollars that could otherwise go to the IRS stay invested and working for you.

Even if you contributed to a 401(k) through work, you may still be eligible to make a deductible IRA contribution depending on your income. It's worth checking — this is one of the few remaining pre-deadline moves available to most Americans.

3. Don't Overlook the New Senior Deduction

If you or your spouse are 65 or older, a new deduction of up to $6,000 per individual ($12,000 for married couples filing jointly) may be available to you for the 2025 tax year — on top of the standard deduction. This is one of the more significant and underreported benefits in recent tax law.

There are income phase-outs to be aware of: the deduction starts to reduce if your modified adjusted gross income exceeds $75,000 (single) or $150,000 (joint), and phases out completely at $175,000 and $250,000 respectively. If you're near those thresholds, a proactive planning conversation could help you navigate it.

4. Review the Updated SALT Deduction Cap

The state and local tax (SALT) deduction cap has been raised from $10,000 to $40,000 for the 2025 tax year. This is a significant change for taxpayers in high-tax states like California, New York, and New Jersey — and it may make itemizing your deductions more attractive than the standard deduction for the first time in years.

Run the numbers before you file. Add up your mortgage interest, charitable contributions, and state/local taxes paid. If that total exceeds your standard deduction, itemizing could mean a meaningfully lower tax bill — especially for California residents who pay both state income tax and high property taxes.

5. Watch Out for Tax Scams — The IRS's Dirty Dozen Is Out

The IRS released its annual Dirty Dozen list of tax scams this week — a timely reminder that filing season brings out fraudsters. This year's list includes phishing emails impersonating the IRS, fake tax preparers, and misleading social media posts claiming you can receive stimulus payments or large refunds you're not entitled to.

As a rule: the IRS will never initiate contact via email, text, or social media. If you're unsure whether a communication is legitimate, go directly to IRS.gov — don't click links in unsolicited messages. Protecting your tax and financial information is just as important as filing on time.

6. High Earners: Consider a Backdoor Roth IRA

For 2025, direct Roth IRA contributions phase out beginning at $150,000 MAGI (single) and $236,000 (married filing jointly), and are completely unavailable above $165,000 and $246,000 respectively. If your income exceeds these thresholds, a backdoor Roth conversion may be the only way to access Roth benefits.

A Roth IRA is one of the most powerful long-term tax tools available — money grows tax-free, qualified withdrawals in retirement are tax-free, and unlike a Traditional IRA, there are no required minimum distributions (RMDs) during your lifetime. The problem for high earners is that the IRS phases out direct contributions once income crosses certain thresholds.

Enter the backdoor Roth — a legal, two-step workaround:

• Step 1: Make a non-deductible (after-tax) contribution to a Traditional IRA — up to $7,000 for 2025, or $8,000 if you're 50 or older.
• Step 2: Convert that Traditional IRA to a Roth IRA. If done promptly before the funds earn any growth, no taxes are owed on the conversion.

Three things to know before executing:

• The pro-rata rule: If you have existing pre-tax IRA balances (such as a rollover IRA from a former employer), the IRS treats all your IRA funds as one pool when calculating taxes on the conversion. This can create an unexpected tax bill and significantly reduce the strategy's benefit. One solution: roll pre-tax IRA balances into your current employer's 401(k) first.
• The five-year rule: Converted funds must remain in the Roth for at least five years (or until age 59½) to avoid early withdrawal penalties. This strategy works best for those with a long time horizon.
• File Form 8606: You must report your non-deductible Traditional IRA contribution on IRS Form 8606 each year. This establishes the after-tax basis and protects you from being double-taxed on the same dollars at withdrawal.

For those who want to go further, the mega backdoor Roth takes this a step further. If your employer's 401(k) plan allows after-tax contributions beyond the standard deferral limit, you may be able to contribute up to $72,000 in total 2025 (depending on plan design and employer match) and convert those after-tax contributions to Roth — a potentially significant accelerator for high earners.

The backdoor Roth is one of those strategies that can look simple on paper but has real complexity in execution. If you're a high earner who hasn't explored it yet, now is a good time to start the conversation — you can still make a 2025 IRA contribution until April 15.

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The Bottom Line

Tax season isn't just about filing — it's one of the best opportunities of the year to take stock of your broader financial picture. The new provisions in effect for 2025 returns are meaningful, but they also require attention to detail to fully capture. And for high earners, strategies like the backdoor Roth represent long-term planning opportunities that go well beyond the deadline.

At DePaolo & May, we believe taxes are your biggest lifetime expense — and that thinking about them only once a year leaves too much on the table. If you have questions about your specific situation or want to start a forward-looking tax strategy, we're here to help.

→ Schedule time to chat with us about your situation today

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