End-of-Year Tax Checklist for High-Earning Households in California

You work hard, your income is high, and California taxes are not gentle. As December closes in, waiting for April can turn into an expensive habit.

A clear california high earner tax checklist gives you order instead of chaos. You see your numbers, decide what to do, and move into the new year with less tax drag and more cash to grow.

This guide walks you through focused, end-of-year steps tailored to high-earning households and business owners in California, so you can protect what you’ve built and position yourself for long-term growth.

1. Know Your 2025 Income Before You Act

Before you touch deductions or investments, get a clean picture of your income.

List every major source:

• W-2 wages and bonuses
• K-1 income from partnerships, S corporations, and LLCs
• Business profit from your own entities
• RSU and stock option exercises
• Capital gains from real estate or portfolio moves

High earners in California may face the top state rate of 13.3%, plus the 1% mental health surcharge on income above $1 million. Underpayment penalties can bite hard if you misjudge.

Review your year-to-date federal and state withholding, plus quarterly estimates. Your 4th quarter California estimated payment for 2025 is due January 15, 2026. The Franchise Tax Board’s 2025 California Form 540-ES instructions outline how to calculate what you still owe.

Ask yourself: if nothing changes between now and year-end, are you comfortable with your expected 2025 bill?

2. Max Out Retirement And Tax-Advantaged Contributions

Once you see your income picture, move to your retirement and savings buckets.

For 2025, you can usually:

• Contribute up to the annual 401(k) limit through your employer
• Add a catch-up contribution if you’re 50 or older
• Fund IRAs, subject to income and plan coverage rules

If you own a business, you may have even more options:

• Solo 401(k) for owner-operators
• SEP IRA for simple, high-limit contributions
• Cash balance plan for very high earners who want large, pre-tax contributions

Many California business owners use advanced plan design, such as combined 401(k) and cash balance strategies, to move six figures from taxable income into long-term retirement wealth. These plans often must be set up by December 31, even if contributions come later.

This is where working with strategic planners who handle tax, retirement, and Business Tax decisions together can pay off. At Herbert Financial, you get that under one roof, so your retirement design matches your tax strategy instead of fighting it.

3. Clean Up Business Tax Issues Before December 31

If you run companies with $5 million or more in revenue, your year-end choices can swing your total tax bill by six figures.

Key areas to review:

• Timing of income and expenses: Can you delay income to early 2026 or accelerate legitimate expenses into 2025 without hurting cash flow?
• Owner compensation: Is your salary from an S corporation “reasonable” while still taking advantage of distributions?
• Large purchases: Should you use Section 179 or bonus depreciation for equipment bought this year, or spread deductions over time?
• Entity structure: Does your mix of LLCs, S corporations, and C corporations still fit your current profit levels?

If your companies file in multiple states, coordination matters. You might already work with a tax accountant Los Angeles, a tax accountant San Diego, or a tax accountant Las Vegas for compliance in each location. You may also lean on a tax consultant Phoenix when you have Arizona operations.

Your checklist here is simple: confirm that your local preparers, your tax advisors Los Angeles, and your planning team are working from the same numbers and the same strategy before the year closes. A focused year-end tax checklist for California taxpayers and business owners can be a helpful comparison.

4. Use Charitable Giving And Investment Losses Wisely

Next, turn to your portfolio and giving plans.

For high-income Californians, thoughtful charitable and investment decisions can trim both federal and state taxes:

• Charitable giving:
  • Donate appreciated stock instead of cash so you skip capital gains and still get a deduction.
  • Use a donor-advised fund when you want a large 2025 deduction but prefer to give over several years.
• Tax-loss harvesting:
  • Realize losses in taxable accounts to offset current-year gains.
  • Use up to $3,000 of net capital loss against ordinary income, with the rest carried forward.

Articles like Range’s guide to high earner tax planning moves for 2025 show how much difference smart timing can make for large portfolios.

In California, you still pay state tax on many of the same income items as federal, so each dollar of realized gain or loss can matter more than you think. Review unrealized gains, expected transactions, and your charitable goals now, not in March.

5. Watch California-Only Rules, Deadlines, And Relief

Your california high earner tax checklist is not complete without state-specific items.

Key points for December 2025:

• Estimated tax: As noted, your 4th quarter payment is due January 15, 2026. Missing this can add penalties and interest that compound over time.
• Filing dates: The standard due date for your 2025 California return is April 15, 2026, with an automatic extension to October 15 to file, but not to pay.
• Local disaster relief: Some households in Los Angeles County affected by wildfires have extended deadlines into late 2026. Check current notices on FTB.ca.gov if this may apply to you.

If your life and business spread across states, California’s residency and sourcing rules add another layer. This is one reason many high earners who already work with a tax consultant Los Angeles still choose a separate planning firm to oversee the bigger picture.

Resources such as the 2025 tax planning guide for California residents can help you see how recent law changes affect timing decisions at year-end.

6. Protect Your Wealth With Estate, Succession, And Risk Planning

Taxes are only part of the story. The rest is about who benefits from your wealth and how well it is protected.

Consider these questions before year-end:

• Do you have an up-to-date will, living trust, and powers of attorney that reflect your current family and business structure?
• Have you reviewed beneficiary designations on retirement accounts and life insurance this year?
• If you plan to sell or transfer a business, have you started formal succession planning?
• Are you using strategies like irrevocable trusts, family LLCs, or charitable remainder tools where appropriate?

Federal estate tax rules are expected to get less generous as early as 2026 under current law, which makes this window important for high-net-worth gifting and legacy moves.

This is where holistic planning matters. With California tax planning for high earners, you connect tax strategy with estate design, retirement income, and insurance under one coordinated plan, guided by advisors who work every day with high-income business owners and families.

Turn Your Checklist Into Action

A checklist only helps if you act on it.

You have seen how income reviews, retirement contributions, Business Tax decisions, charitable moves, California deadlines, and estate planning all connect. Together they shape how much tax you pay and how much financial clarity you carry into the new year.

If you want guidance tailored to your numbers, your entities, and your goals, schedule time with a planning team that lives and breathes high earner strategy. At Herbert Financial, you work with tax-focused advisors who coordinate with your tax consultant Los Angeles or other local professionals to protect what you have built and position you for growth.

Schedule your appointment or reach out to learn more about turning this checklist into a concrete plan for 2025 and beyond.