10 Year-End Money Moves for People 70 and Older Still Working in 2026

The still-working exception is the most valuable rule this group has, and the most misunderstood. If you are still employed and you do not own more than 5% of the company, you can delay RMDs from your current employer's 401(k) or 403(b) until April 1 of the year after you retire. The exception does not reach IRAs, SEP IRAs, or 401(k)s from prior employers; those follow the normal schedule at 73 (born 1951 to 1959) or 75 (born 1960 or later). The workaround is to roll that other pre-tax money into the current plan, if the plan accepts roll-ins. RMDs are calculated on the December 31 balance of the prior year, so an IRA that is empty on December 31, 2026 has no 2027 RMD. Any RMD already due for 2026 must come out first, because RMD dollars cannot be rolled over.

The income stack is the second issue. A couple with one spouse earning $200,000 at 72, $80,000 of combined Social Security, and $40,000 of IRA RMDs is looking at MAGI above $300,000, well into the second 2026 IRMAA tier for joint filers ($274,001 to $342,000). Up to 85% of the Social Security is federally taxable (Arizona does not tax it), the $6,000 per person senior deduction shrinks by 6% of MAGI above $150,000, and the 3.8% net investment income tax applies to dividends and gains once MAGI tops $250,000. Each of those is a separate marginal rate hiding on top of the 24% bracket. The levers that actually move MAGI are traditional 401(k) deferrals, QCDs, the roll-in above, and the timing of bonuses and deferred compensation.

QCDs and IRA contributions interact in a way that trips up people who keep working. Traditional IRA contributions are allowed at any age with earned income, but deductible contributions made after 70 1/2 reduce the amount of future QCDs you can exclude from income, dollar for dollar, on a cumulative basis. Someone who deducts $8,600 of IRA contributions and then gives $20,000 through a QCD only gets $11,400 excluded as a QCD; the other $8,600 is treated as a taxable distribution (potentially deductible as a charitable gift if you itemize). If you are charitably inclined, a Roth IRA contribution, if income allows, or simply putting more into the 401(k), usually works better than a deductible IRA contribution after 70 1/2.

Medicare and the HSA are the third trap. Once you claim Social Security at 65 or later, Part A starts automatically, and HSA contributions from you and your employer must stop. When you apply for Social Security or Part A after 65, Part A is backdated up to six months (never before the month you turn 65), which can make the last several months of HSA contributions excess contributions subject to a 6% excise tax unless you withdraw them. Part B is a separate decision. With group coverage through current employment at an employer with 20 or more employees, you can delay Part B without penalty and use an 8-month special enrollment period after the job or the coverage ends. COBRA and retiree coverage do not count as current employment for that purpose.

The exit decision ties all of this together. The year you retire becomes the first RMD year for your current plan, even if you retire on December 31, and that first RMD can wait until April 1 of the following year at the cost of two RMDs in one tax year. Retiring on January 2 instead of December 31 moves the first plan RMD back a full year. The retirement year is also usually a high-income year (final wages, bonus, PTO payout), followed by a sharp drop. That drop is a life-changing event for IRMAA: Form SSA-44 lets you ask Medicare to use your lower current income instead of the two-year-old return, which can remove surcharges for the two years after you stop working.

October is for the decisions that need paperwork and lead time. Confirm with your plan administrator in writing that the plan accepts roll-ins of IRA and prior-employer money, and ask how long a roll-in takes; some plans need three to six weeks. Take any 2026 RMD from those accounts before starting the roll-in. Check your 401(k) deferral rate against the remaining paychecks, because an election change often needs two to four weeks to hit payroll. If you are 70 and have not applied for Social Security, apply now. Review Medicare coverage during Annual Enrollment, October 15 to December 7, if you are already enrolled in Part B or Part D.

November is for the tax projection. By then you know your wages, bonus, RSU vests, and most dividends, so you can see where 2026 MAGI lands against the IRMAA tiers, the $250,000 NIIT threshold, and the senior deduction phase-out. Size QCDs and decide on bonus timing or deferral elections from that projection. Nonqualified deferred compensation elections for 2027 pay generally must be made by December 31, 2026, so this is also the time to decide whether to defer next year's bonus into a lower-income year after retirement.

December is for execution, and custodians set their own cutoffs. Most want RMD and QCD instructions by early to mid December, and a QCD check the charity has not cashed by year-end can create a reporting mismatch. Complete annual gifts, finish the roll-in so the IRA balance is zero on December 31, and set withholding on any December IRA distribution to cover whatever the year's wage withholding missed. IRA and HSA contributions for 2026 can wait until April 15, 2027; 401(k) deferrals cannot, because they must come out of 2026 paychecks.

Consider an illustrative household: a married couple, one spouse 74 and still working with $210,000 of salary, the other 72 and retired, with $78,000 of combined Social Security, $1.1 million in the working spouse's traditional IRA, and $600,000 in the current 401(k). The 2026 IRA RMD is about $43,100 ($1.1 million divided by 25.5). Sending $15,000 of it as QCDs, deferring the full $32,500 traditional, and rolling the remaining IRA into the 401(k) by December 31 drops 2026 MAGI from roughly $319,000 to roughly $272,000, just under the second IRMAA tier. Because the IRA is empty on December 31, next year has no IRA RMD, taking roughly $44,000 more out of 2027 MAGI while the working spouse stays employed. Illustrative only; actual results depend on the plan's rules and the full return.

• Assuming the still-working exception covers IRAs and old 401(k)s, then missing the RMDs on those accounts and facing the 25% penalty (10% if corrected promptly).
• Rolling an IRA into the current 401(k) without first taking that year's RMD from the IRA, which makes the RMD portion an ineligible rollover that has to be corrected.
• Retiring on December 31 instead of early January without realizing that the retirement year becomes the first RMD year for the current plan.
• Claiming Social Security at 70 while still funding an HSA, then discovering that Part A was backdated six months and some of the year's contributions are excess.
• Making deductible traditional IRA contributions after 70 1/2 and then giving through QCDs, which quietly reduces the QCD exclusion dollar for dollar.
• Dropping employer coverage and moving to COBRA without enrolling in Part B, on the belief that COBRA protects against the late-enrollment penalty the way active employment does.
• Letting wages, Social Security, and RMDs land in the same year as a large bonus or deferred compensation payout without checking the IRMAA tier it creates two years later.