The Reindex

Last Thursday, while most people were still arguing about election results, the IRS quietly published the most useful document of the month.

It's called Revenue Procedure 2026-35. It's dry. It's long. And it moves almost 70 numbers in the tax code for 2027, from the standard deduction to the gift exclusion to how much you can run through a health FSA. You can read the IRS's own summary in its November 5 release.

Here's why I care, and why you should too.

Every good money system I've ever built runs on numbers somebody typed in once. A 401(k) percentage. An HSA payroll deduction. A transit benefit. A gift you send the kids every January. You set them, you walk away, and that's the whole point. Automation is supposed to be boring.

But automation has one blind spot. It doesn't read the news.

Your payroll system will happily keep running 2026 math all the way through 2027. It won't raise your deferral when the limit goes up. It won't notice your employer's HSA deposit now crowds out part of yours. It won't tell you that the way you set your 401(k) could cost you thousands in matching dollars. It just keeps doing what you told it to do a year ago.

So once a year, I reindex. One hour, usually in November, and every number in my system gets checked against the new rules. This is that hour, built for you.

You don't need all 70 changes. You need the handful that touch your paycheck, your accounts, and your calendar. Here's my short list. Everything comes from the IRS unless I tell you otherwise.

Standard deduction. Married couples get 33,200 dollars next year, a thousand more than now. Singles get 16,600. Heads of household, 24,925. If you don't itemize, that's a little extra shelter you didn't have to lift a finger for.

Tax brackets. Every line slid up. If you're single, you don't touch the 22 percent rate until you're past 52,025 dollars of taxable income, and 24 percent waits until 109,125. Married? Those lines sit at 104,050 and 218,250. The top 37 percent rate doesn't show up until 661,375 for singles and 793,650 for couples. Translation: if your raise roughly kept up with prices, the tax code shouldn't punish you for it.

Annual gift exclusion. This one I like. It goes to 20,000 dollars per giver, per person you give to. It was 19,000. So you and your spouse can hand each kid 40,000 next year and never file a gift tax return.

Estate exclusion. 15.48 million a person. Most of you will never care. A few of you really, really will.

Health FSA. Up a hundred bucks to 3,500. Carryover, if your plan offers it, tops out at 700.

Transit and parking. 350 a month each, ten dollars more. I'm including it because half the people I talk to forget they even have it.

Child tax credit. 2,300 per kid, and up to 1,800 of that is refundable.

HSA. Old news, technically. The IRS set these back in May through Revenue Procedure 2026-24: 4,500 if it's just you, 9,000 for a family plan. Over 55? You still get your extra grand on top.

Social Security wage base. Climbs to 192,300 from 184,500, per the Journal of Accountancy. Retirees, meanwhile, get a 3.6 percent raise in January.

401(k) and IRA limits. The annoying one. As I write this, the IRS hasn't published it. That notice usually lands in early or mid November. Milliman and Marsh both think the 401(k) number goes to 25,500, a thousand more than this year, according to 401(k) Specialist. The IRA limit? Honestly a toss-up between 7,500 and 8,000. Depends which way the rounding breaks.

That last item is the reason this system has a watcher built in. More on that in a minute.

Most people assume a stale setting just means they save a little less. Sometimes that's true. Sometimes it's worse.

Leak one: you leave room on the table. Say you dialed your 401(k) in to hit 24,500 this year. Leave it alone and you'll miss a thousand bucks of tax-deferred room in 2027 without ever knowing it. Miss a little every year for a decade and it stops being a rounding error.

Leak two: you hit the limit too early and lose the match. This is the expensive one, and almost nobody checks for it.

Lots of plans figure the match one paycheck at a time. Max out early and your contributions stop. Guess what else stops. Some plans fix this with something called a true-up at year end. Plenty don't.

Let me show you with real numbers. You make 160,000 dollars, paid every other Friday. That's about 6,154 dollars a check. Your company matches dollar for dollar on the first 4 percent. Call it 246 bucks a check, 6,400 a year.

Now say you're aggressive and set your deferral at 25 percent so you max out fast. You'd hit 25,500 dollars around your 17th paycheck. After that, no contributions and, if there's no true-up, no match. That's nine paychecks with nothing from your employer. Roughly 2,215 dollars gone. Not invested badly. Just gone.

Leak three: your employer's money crowds out yours. The HSA limit includes what your employer puts in. If your company deposits 1,000 dollars into your family HSA and you also contribute the full 9,000 through payroll, you're 1,000 over. Now you're filling out paperwork to pull the excess back out before your tax filing deadline, or eating a 6 percent excise tax every year it sits there.

None of these show up as an error message. They just show up as less money.

Block one hour. Coffee is optional. Your last pay stub is not.

Step 1: Build your limits card.

Grab a blank page and split it down the middle. This year's numbers on the left, next year's on the right. Don't copy all 70. Just the ones you actually touch, which for most people means the 401(k), IRA, HSA, both FSAs, transit, the gift exclusion, and the Social Security wage base if you earn anywhere near it.

Mine lives in Notion. A Google Sheet is just as good. The point is one place that answers "what's the number this year" without a search engine.

Step 2: Do the paycheck math for your 401(k).

Three moves:

Back to our 160,000-dollar earner. 25,500 divided by 26 checks is about 981 dollars per check. 981 divided by 6,154 is 15.9 percent. Most payroll systems only take whole numbers, so you'd set 16 percent. You'd contribute about 985 a check, and payroll stops you automatically when you hit the cap in the final check of the year.

Spreading it evenly like that protects the match on every single paycheck. Slow and even wins here, unless you know for a fact your plan trues up.

Fifty or older? Bake the catch-up into your target first, then divide. Between 60 and 63, you get the bigger "super" catch-up, so wait for the official figure on that one.

Step 3: Do the HSA math, net of your employer.

Start with the 2027 limit for your plan type. Knock off whatever your company puts in. Over 55? Add your extra 1,000. Then spread it across your paychecks.

Family plan, company kicks in a grand. That leaves you 8,000 to fund yourself. Over 26 checks, that's about 308 dollars each. That's your number. Not 346, which is what you'd get if you forgot the employer piece.

Step 4: Lock your FSA elections now.

You pick FSA amounts during open enrollment, and at a lot of companies that's happening right now. Go find the HR email you've been ignoring. Health FSA tops out at 3,500 next year. The dependent care cap stays at 7,500 per household. Elect based on what you'll actually spend, not the max. Unused money in a plan with no carryover or grace period just disappears.

Step 5: High earner? Look at the Social Security line.

Earn north of 192,300 in wages and another 7,800 of your pay gets hit with Social Security tax next year. That's 483.60 more out the door. And that nice paycheck bump you get late in the year when the tax shuts off? It shows up a little later now. If you're self-employed, it's 12.4 percent on that extra slice, so 967.20 dollars. Not a crisis. Plan for it so September doesn't feel like a pay cut.

Step 6: Bump your recurring gifts, if you want to.

Got an automatic January transfer to the kids? The ceiling's now 20,000 per person. Nobody says you have to use it. But if you've been bumping into the 19,000 line, you've got 1,000 more of room per person, per giver.

Step 7: Send the payroll change.

This is the step people skip. They do all the math, then forget to tell anyone. Most HR systems let you change your deferral online in two minutes. Some need two or three pay cycles to process. Either way, get it in before December 1 so your first 2027 paycheck reflects the new number.

Here's the system piece, and it's what turns this from a one-time chore into something that runs itself.

I built a small Make.com scenario that watches the IRS newsroom feed. Anytime a headline mentions contribution limits or cost-of-living adjustments, it fires. My phone buzzes. It adds a task to my Notion board called "Reindex: confirm new limits." And it logs the date so I can see when the notice dropped compared to last year.

That's it. Three modules. It costs nothing to run, and it means I don't have to remember that the 401(k) notice is still pending. The scenario remembers for me.

A second scenario fires on January 2 every year. It nags me to open my first pay stub of the year and eyeball three deductions. 401(k). HSA. FSA. If any of them still match last year, something didn't stick.

Now, the math. Me plus a calculator at 9pm is a bad combination, so I hand it off. Salary, pay schedule, match formula, employer HSA deposit, all of it goes into Galaxy.ai with this prompt:

"I earn [salary], paid [frequency]. My employer matches [formula]. My plan [does / does not / I don't know if it] does a year-end true-up. My employer contributes [amount] to my [self-only / family] HSA. I'm [age]. Using a 2027 401(k) limit of 25,500 dollars and HSA limits of 4,500 self-only and 9,000 family, calculate the whole-number deferral percentage that maxes my 401(k) without stopping before my final paycheck, my per-paycheck HSA contribution net of my employer's deposit, and how much matching I'd lose if I front-loaded to max out by September."

I run it through two different models inside Galaxy. If they agree, I'm done. If they don't, I find out why before I touch payroll. That one habit has caught more mistakes than any spreadsheet I've ever built.

If your benefits are confusing enough that you need a call with HR, record it with Fathom, with their okay. You'll get a written summary of what they told you about true-ups and FSA carryover, which beats trying to remember it in February.

This week: Build your limits card. Pull your last pay stub. Figure out whether your plan does a true-up. The answer's buried in the summary plan description, or you can just email HR and ask.

When the IRS 401(k) notice drops: Make sure it really is 25,500, and grab your catch-up number. Rerun the paycheck math if anything changed.

Before your open enrollment closes: Make your FSA and HSA elections using the 2027 numbers, net of any employer deposits.

By December 1: Get the new 401(k) percentage and HSA amount into payroll so your first January check reflects them.

January 2: Open that first pay stub of 2027. Check every deduction against your card.

I get it. Inflation adjustments sound like trivia night for accountants. A couple hundred bucks here. A grand there.

But here's the thing about systems. Small errors in a system don't stay small. They repeat. Every paycheck, every year, quietly, until somebody notices. People who reindex every year aren't smarter than everyone else. They just built a habit that catches the drift.

The tax code moved on Thursday. Your autopilot didn't. One hour fixes that.

Want the whole Reindex done for you?

I built The Reindex Kit so you can knock this out in one sitting. It includes the 2026 versus 2027 limits card, the per-paycheck calculator for your 401(k), HSA, and FSA (with employer deposits built in), the match true-up checker that shows exactly what front-loading would cost you, the Social Security wage base calculator, a copy-and-paste email to HR, my Galaxy.ai prompt, the Make.com IRS notice watcher blueprint, and the January 2 pay stub audit checklist.

Reply to this email with the word REINDEX and I'll send it over.

About the room.

The Grid Inner Circle is where members bring their real numbers and we build the system together, on screen. This month, members are running their own pay stubs through the Reindex math live, and we're setting up the IRS watcher scenario start to finish so nobody has to do it alone at midnight.

Monthly is 29 dollars. The lifetime seat is 499 dollars, paid once, with every future session, template, and live build included for as long as the Circle runs. If you're the kind of person who'd rather set something up once and never think about it again, the lifetime seat is basically this whole newsletter's philosophy in one decision. The founding price goes away when the founding seats do.

Reply with the word LIFETIME and I'll send you the details and the link.

See you Wednesday.

Alex Rivera, Wealth Architect at Wealth Grid

This is education, not tax, legal, or financial advice. The 2027 401(k) and IRA limits are forecasts until the IRS publishes its notice. Your plan's match formula, true-up rules, and FSA carryover depend on your employer. Confirm your numbers with your plan administrator or a tax professional before you change anything.