Your Mid-Year Tax Check-Up: 10 Moves to Make Before June 30

Memorial Day marks the unofficial start of summer — and it’s also the perfect time for a mid-year tax review. Half the year’s income is in the books, Q2 estimated payments are due June 15, and the One Big Beautiful Bill Act has changed enough rules that your January assumptions may need updating. At The Law Office of Pietro Canestrelli, we help taxpayers across Temecula, San Diego, Riverside, San Bernardino, and throughout California make smart mid-year adjustments that reduce their April 2027 tax bill. Here are 10 moves to consider before June 30.

1. Recalculate Your Estimated Tax Payments

If you pay quarterly estimated taxes, mid-year is the time to reassess. Your Q1 payment (April 15) was based on projections. Now you have five months of actual income data. Compare your projections to reality — and remember California’s 30/40/0/30 split means your June 15 payment should be 40% of your annual estimated liability, not 25%.

Key changes that may affect your estimates:

• OBBBA deductions you’re now eligible for (tips, overtime, auto loan, senior)
• Changes in business income or self-employment earnings
• Capital gains from stock sales or real estate transactions
• The higher SALT cap potentially changing your itemization calculation

Underpaying estimated taxes triggers penalties from both the IRS and the California FTB. Our article on estimated tax payments explains the rules in detail.

2. Review Your W-4 Withholding

The OBBBA’s new deductions may have reduced your federal tax liability — meaning your current withholding could be too aggressive. On the other hand, California’s nonconformity means your state liability hasn’t changed. Review both federal and California withholding to avoid over-withholding (an interest-free loan to the government) or under-withholding (a penalty-triggering surprise in April).

The IRS Tax Withholding Estimator (available at IRS.gov) can help you model the impact of the new deductions on your withholding needs.

3. Maximize Retirement Contributions

If you haven’t been contributing the maximum to your retirement accounts, mid-year is the time to increase your contributions:

• 401(k)/403(b): $23,500 limit for 2026 ($31,000 if age 50+; $34,750 if age 60-63 under the SECURE 2.0 super catch-up)
• Traditional/Roth IRA: $7,000 limit ($8,000 if age 50+)
• SEP-IRA: Up to 25% of net self-employment income, up to $70,000
• Solo 401(k): Up to $70,000 in combined employee/employer contributions ($77,500 with catch-up)

New for 2026: Under SECURE 2.0, catch-up contributions for employees earning over $150,000 must be made on an after-tax Roth basis. If you’re a high earner, ensure your payroll system is configured correctly.

4. Evaluate Your PTE Election (California Business Owners)

The California PTE elective tax prepayment deadline is June 15. If you own an S-corp, partnership, or multi-member LLC and haven’t yet evaluated whether the PTE election makes sense for your business, now is the time.

The PTE election allows your entity to deduct California state taxes at the entity level — bypassing the SALT cap entirely. At 9.3%, it’s a powerful tool for business owners with income above the SALT cap phase-out thresholds. Our business formation page explains entity-level election options.

5. Harvest Tax Losses (or Gains)

If your investment portfolio has losers, mid-year can be a strategic time to sell and “harvest” those losses. Capital losses offset capital gains dollar-for-dollar, and up to $3,000 in excess losses can offset ordinary income.

Conversely, if you’ve already realized significant gains in the first half of the year, you may want to identify positions with unrealized losses to offset those gains before December 31. Read our guide on stock market tax tips for more strategies.

6. Review Your Health Insurance and HSA

If you have a High Deductible Health Plan (HDHP), ensure you’re contributing to your Health Savings Account (HSA). HSA contributions are tax-deductible, grow tax-free, and can be withdrawn tax-free for qualified medical expenses. The 2026 limits are $4,300 for individual coverage and $8,550 for family coverage ($1,000 additional catch-up for age 55+).

HSA contributions for the current tax year can be made up until the following April 15 — but starting early means more time for tax-advantaged growth.

7. Check on Bonus Depreciation and Equipment Purchases

With 100% bonus depreciation now permanent, there’s less urgency to buy equipment before year-end. But if you’re planning a major purchase (equipment, vehicles, technology), buying before June 30 allows you to claim the deduction on your mid-year estimated payments — improving cash flow in Q3 and Q4.

Remember: California doesn’t conform to federal bonus depreciation, so the state tax benefit will be spread over multiple years regardless of when you buy. See our Section 179 deduction page for California-friendly alternatives.

8. Organize Your Crypto Records

If you’ve been trading cryptocurrency in 2026, the IRS is now receiving Form 1099-DA from custodial exchanges. Mid-year is the time to reconcile your trading records with your exchange reports, identify cost basis issues, and develop a tracking system for the rest of the year.

Pay special attention to:

• Transfers between wallets (which may cause cost basis gaps)
• DeFi transactions (staking rewards, liquidity pool income, airdrops)
• Tokens acquired before 2026 (cost basis reporting may not be available from exchanges)

Read our 2026 crypto tax reporting guide for comprehensive guidance.

9. Plan for Life Changes in the Second Half

Are you getting married, having a baby, buying or selling a home, starting a business, retiring, or sending a child to college? Each of these events has tax implications that are best planned for in advance — not discovered in April. Key planning opportunities include:

• Filing status changes (marriage affects brackets, eligibility for deductions, and student loan repayment plans)
• Home sale exclusion planning ($250K/$500K exclusion under Section 121)
• Education tax credits for college expenses
• Business formation timing to optimize first-year deductions

10. Address Any Outstanding IRS Issues Now

If you have unfiled returns, unpaid balances, unanswered IRS notices, or an ongoing audit, mid-year is the time to take action. The IRS enforcement process doesn’t pause for summer vacation — and addressing issues now gives you maximum leverage before year-end collection pushes.

• Unfiled returns: File delinquent returns to stop the clock on penalties and preserve resolution options
• Unpaid balances: Explore tax relief options before the IRS escalates to liens or levies
• IRS notices: Review our guide to common IRS letters and respond within the deadlines

Schedule Your Mid-Year Review

At The Law Office of Pietro Canestrelli, we offer mid-year tax planning consultations for individuals and businesses across Temecula, San Diego, Riverside, San Bernardino, and all of California. Whether you need to adjust estimated payments, evaluate entity elections, or resolve an outstanding IRS issue, our team can help you make the moves that matter before June 30.

Don’t wait until December. Contact our office to schedule your mid-year tax check-up today.