Following This Season of Giving to the IRS … Some Good News for Retirement Savers!
Concerned about your financial security in retirement? Well here are expanded opportunities to contribute more to your retirement account(s) this year … thanks to the annual inflation adjustments announced by the IRS. Bottom –line for you … larger retirement contributions may lower your tax bite, plus deliver more retirement income.
So here’s the rundown on how much more you can sock away toward your retirement in 2019.
401(k) Plans/403(b)/Thrift Savings/Most 457 Plans:
• Up to $19,000 … a $500 increase over the 2018 limit of $18,500
• 401(k) catch-up contributions for those age 50 or older unchanged at $6,000
Traditional IRA & Roth IRA
• New contribution limit bumped to $6,000 from previous level of $5,500; Note: First increase since 2013.
• Catch-up contributions for those age 50 or older unchanged at $1,000
Multiple Plan Contributions
If you participate in a 401(k) and an IRA or Roth IRA, you may be able to max out your annual contributions by a significant amount. It’s a bit complex requiring an individual analysis of your circumstances regarding your regular contributions to these plans plus available catch-up contributions. Best bet: Give me a call to discuss.
Small Business Owners & Self-employed Taxpayers
• Contributions to a Solo 401k() or SEP IRA increase from $55,000 in 2018 to $56,000 this year.
• Note: Allowable contributions may vary based on amounts contributed as employee and employer.
• Solo 401(k) catch-up contributions for folks age 50 or older unchanged at $6,000.
• No catch-up contributions allowed for a SEP IRA
As you may expect, there are details beyond the scope of this summary that will affect contribution limits based on such things as marital status and compensation. If you choose to get “deep in the weeds”, here are the official highlights of the changes on the IRS Site.
Better yet … We will help! Just give us a call or drop an email. We’ll respond promptly!