If you didn’t save as much for retirement as you wanted last year, you have until July 15 to make contributions

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  • The federal tax deadline is July 15, which means there’s more time to contribute retirement savings to your IRA and HSA.
  • You can add money to your IRA up to the annual limit — $6,000, or $7,000 if you’re 50 or older — and count it as a 2019 contribution until July 15.
  • The same goes for your health savings account, up to $3,500 for individuals and $7,000 for families, plus a $1,000 catch-up if you’re 55 or older.
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If you didn’t save as much for retirement last year as you’d hoped, there’s good news: You now have until July 15 to contribute to an IRA. The deadline for contributions is Tax Day, which is usually April 15.

This year, due to the coronavirus pandemic, the IRS extended the tax-filing deadline for income earned in 2019 to July 15, and has waived all penalties and interest on tax payments during the 90-day postponement.

To make additional contributions to your IRA for the 2019 tax year, you should contact the brokerage where your IRA is held to make sure any funds you add to your account are filed correctly. The maximum annual contribution is $6,000, plus an extra $1,000 if you’re over age 50, and is combined for traditional and Roth IRAs.

Traditional IRA contributions may be tax deductible, depending on your income and whether you participate in a workplace retirement plan. Roth IRA contributions are not tax deductible, and your ability to contribute is limited by your earnings.

But it’s not just retirement. The tax deadline extension also means you can put more money into a health savings account (HSA) for the 2019 tax year. HSA contributions are also tax deductible and funds can be distributed at any time to cover qualified medical costs.

You must be currently enrolled in a high deductible health plan to contribute to an HSA. If you’re single, you can save a maximum of $3,500 for the year, and if you have a spouse or dependents on your health plan, you can save up to $7,000 for 2019. There’s also an additional $1,000 catch-up limit for savers 55 and older.

It’s a trying time for many Americans as the coronavirus pandemic prompts business closures and mass layoffs in several consumer-facing industries. If you do have cash to spare right now, it’s a good idea to pad your retirement accounts and continue to invest.

If you need tax strategy help with your retirement savings accounts, we are here to help. Schedule a 15 minute phone call so we can help you get answers to all of your financial questions.

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source article: https://www.businessinsider.com/personal-finance/irs-extends-ira-retirement-health-savings-contributions-new-tax-deadline