One planning insight. Two charts that caught our eye. Helping you stay the course in under three minutes.

Planning Insight | May 2026

Got a Surprise Tax Bill in April? May Is When to Fix It.

Plenty of filers walked away from this tax season with a balance due bigger than expected. Strong 2025 market returns drove a wave of mutual fund capital gain distributions, RSU vests cleared at withholding rates that did not match marginal brackets, and bonus and side income outpaced what default W-4 settings could absorb. The result was a surprise check written to the IRS, and in some cases an underpayment penalty on top.

The instinct is to file it away as a problem to revisit in December. That instinct is wrong. Withholding is the largest lever you have, and it only works if there is time on the clock. Closing a $10,000 gap in May spreads across 16 pay cycles. The same gap in November compresses into two.

Here's two practical moves this month:

1. Adjust your W-4. Step 4(c) lets you add a flat dollar amount of extra withholding per pay period. If you're married filing jointly, coordinate with your spouse's W-4. The default joint settings consistently under-withhold dual-income households.

2. Size your next quarterly estimate. If you have meaningful 1099, RSU, or business income, June 15 is the next deadline. That payment can be sized to fill the gap directly.

One framing worth knowing: pay in 110% of last year's tax through withholding and estimates (100% if AGI is under $150,000) and you avoid federal underpayment penalties, no matter what your 2026 bill ends up being. That target is cleaner than trying to forecast this year perfectly.

Eight months of runway is plenty to course-correct. Two months is harder. One is painful. For our clients, we build a tax projection at the start of each year and refine it as income, market activity, and life events come into view, so April rarely brings surprises. If having that running picture would be useful, reach out and we'll walk you through what it looks like.

What Caught Our Eye

A couple of charts and graphics we found insightful this month.

AI is Building, Not Just Replacing.

Business formation has stayed well above pre-pandemic levels, and the gap is widest in sectors where AI adoption is highest. A small but telling signal that the technology is creating opportunity, not just consolidating existing players.

Going for the Four-Peat?

A 20% 2026 would give the S&P 500 four consecutive years of double-digit gains, something that has happened only twice before since 1957. Those prior streaks have names: the postwar boom and the Dot-Com Bubble.

Whenever you're ready, we’re here to help:

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