It’s the final stretch of 2021!

At the risk of adding another thing to your full plate, we also need to consider the potential tax-law changes proposed in the Build Back Better Bill. We anticipate that the senate will vote on this bill sometime before the ball drops in Times Square. For now, we’re planning for the final weeks of 2021 and 2022 with what we know about the potential tax law changes.

Below are five tax strategies that can set you up for success heading into 2022:

Backdoor 401(k)

Backdoor IRA Contribution


 Tax Loss


(1) Mega Backdoor 401(k)

If you participate in your company’s Mega Backdoor 401(k) you will want to make sure that these dollars have been converted to Roth dollars.  Completing the in-plan conversion will allow these dollars to go directly into a Roth IRA in the future. Depending on your plan you may be able to make this election online or you may have to call and complete the request.

(2) Backdoor IRA Contribution

Potentially starting in 2022, you may no longer be able to make an after-tax contribution to your IRA and then convert it to your Roth IRA. If you have not made your 2021 IRA contribution, you should consider completing the contribution and conversion before year-end.


(3) Roth Conversions

Potentially starting in 2022, you may no longer be able to convert after-tax contributions to your Roth IRA. If you have after-tax dollars in your IRA, you may want to consider completing a Roth conversion before year-end. Your advisor can help you think through whether it makes sense to pay some tax now via a Roth-conversion strategy.



(4) Tax-Loss Harvesting

We encourage you to consider recognizing tax losses if you have any available before year-end. Tax-loss harvesting can be a somewhat time-consuming and technical endeavor, so we encourage you to consult your advisor for guidance. In addition, 2021 is the last year that “wash-sale rules” do not apply to cryptocurrency. This means you can sell your cryptocurrency at a loss and almost immediately buy-back the same position. As previously mentioned, there are several rules around tax-loss harvesting and we encourage you to talk with an advisor for further guidance.

(5) Charitable Giving

As we move into the holiday season, it is a great time to think about charitable giving. We encourage you to talk with your advisor about how to best structure your gifting from a tax perspective. For those of you who have a company gift-matching program, don’t forget to submit your gift matching forms!


Let us know if we can help you think through year-end planning opportunities. Deadlines are quickly approaching, so time is of the essence as we move towards the end of 2021.