Tuesday, February 07, 2017

2016 IRA Contribution Deadline Is In 2017

The deadline for making 2016 IRA contributions is the due date of the 2016 tax return, which is April 17, 2017 this year.  It is one of a couple items for the 2016 tax year than can be done after 2016.   It gives the taxpayer an opportunity reduce the tax owed if they choose to do so.

The contribution limits for 2016 are $5,500 for under 50, ad $6,500 for 50 and older.  If 2016 wage earnings are less then that is the maximum for 2016..

A traditional IRA allows the contribution to be deducted from income for taxes, a Roth IRA does not all a deduction, but withdrawals in the future are tax free.

Even though we are retired, we earned a small amount of wage income.   We will put those funds in a a traditional IRA to get the benefit for a tax deduction and the benefit of tax free growth.  

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This is not financial or tax advice. Please consult a professional advisor.

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