It is that time of year again when we all must do the one annual activity we most likely dread…Taxes! It is also that time of year to ensure all clients are taking full advantage of all contributions, specifically to their IRA. Taxpayers still have time to potentially claim deductions to their 2021 tax returns. Contributions for 2021 can be made to Traditional or Roth IRAs until the filing date, April 18th, 2022, so long as contributions are designated for 2021. Note, while contributions for Roth IRAs are not tax-deductible, qualified distributions are tax-free.
Eligible taxpayers can contribute up to $6,000 to an IRA for 2021. For those 50 years of age or older at the end of 2021, the limit has increased to $7,000. For those 50 or older there is a $1,000 catch up allowed over the $6,000 for a total of $7,000. The IRS states there is no longer a maximum age for making an IRA contribution. So even if you are retired and over the age of 72, you can contribute to an IRA or a Roth IRA if you have other earned income besides social security, like investing or online trading, as you can find resources like gold trading which can help you in this area. To find out more about the taxable deductions or what qualifies for other income, please be sure to ask a tax advisor.
We work with numerous people looking for a place to maintain their contribution, and with everything so volatile in the market and life, we can help keep money from contributions safe in an annuity, if you run out of money and you need to start over, you can now get a loan here. We provide carriers that will allow contributions and allow additions every year to the account.
Remember, for all qualified accounts (IRA, 401k, 403B, retirement plans), all have a Required Minimum Distribution (RMD) that is required to be taken by April 1st of the year after you turn 72 (for people born after June 30th, 1949). Subsequent RMDs must be taken by December 31st each year. If you don’t take the RMD, you’ll have to pay a penalty of 50% of the RMD amount.
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