Contributing to your IRA is one of the best ways to secure your financial future. The investment into this interest compounding, and tax-deferred or tax-free environment, comes with positive impacts on your retirement savings.
Contributing to your IRA also provides tax benefits. You can deduct them on your tax return depending on how much income you make, whether you or your spouse are currently contributing to other qualified retirement plans, and what type of IRA you have.
Remember to Contribute to Your IRA Before Tax Day.
If you own a Traditional IRA, Roth IRA, or a SEP IRA, remember that the deadline to contribute is Tax Day on April 15, 2020.
Contributions made prior to Tax Day mean an additional deduction or credit on your taxes, while also increasing your retirement savings.
In effect, the government is giving you money to save for retirement. Why not take advantage of that?
There are limits, however to how much you can contribute. If you contribute too much, you could be subject to tax penalties.
IRA Contribution Limits 2019
For tax year 2019, you can contribute up to $6,000 to a traditional or Roth IRA. If you’re 50 years old or older, you can deduct an additional $1,000 as a catch-up contribution, making the maximum contribution $7,000.
With an SEP IRA, you can contribute the lesser of 25% of compensation or $56K.
If you have any questions on your retirement accounts or contributing, please contact one of our experienced attorneys here.