These days between January 1 and tax filing day, April 18, 2017, represent a unique opportunity for retirement planning. During this time period, you can ‘true up’ your full contribution for 2016, as well as make your 2017 deposit.
Contributions remain the same for 2017. For both traditional and Roth IRAs, you can contribute $5,500 if you are under age 50, with an increase to $6,500 if you are over age 50. Note that this year’s deadline to make an IRA contribution is April 18, 2017 for tax year 2016.
As always, there are income limits to deduct traditional IRA contributions; these income limits have increased for 2017 as follows:
- Singles and heads of household who contribute to a workplace retirement plan can claim a fully deductible contribution if their income totals less than $62,000.
- For married couples filing jointly, a spouse who contributes to a workplace retirement plan can claim a full deduction if their income falls below $99,000. From there, the deduction phases out between $99,000 to $119,000. If you can’t make a deductible IRA contribution, consider a nondeductible contribution.
Income limits for Roth IRA contributions have increased as follows:
- Single filers earning less than $118,000 can make a full Roth IRA contribution; contributions are eliminated for filers earning more than $133,000.
- Married couples filing jointly can make a full contribution to a Roth IRA if their combined income is less than $186,000. However, they are not eligible to contribute if their income exceeds $196,000.
Don’t let this opportunity to save for your future, using either Traditional or Roth IRA options, pass you by. You can gain either tax advantages for your current filing year, or enrich your future. Contact me at 716-691-8207, or your investment adviser for further information. Don’t wait too long!
Adrienne Grace is a CFP®, CLTC, CDFATM, and a Certified Divorce Financial Analyst.
Securities offered through Cadaret, Grant & Co., Inc. Member FINRA/SIPC. Davis Financial does not provide tax or legal advice. Consult with a qualified tax specialist regarding your particular situation and filing requirements
