The Moneys Department and the IRS are giving you more time to sock away money in tax-favored accounts – and have it count for 2019.
The IRS announced that savers now should prefer to until July 15 to make 2019 contributions into their individual retirement accounts and their haleness savings accounts, which are typically paired with a high-deductible health plan.
Normally you would have until April 15 — the conventional due date for tax returns — to put this money away and have it apply to the prior year.
The agencies’ decision to move the deadline for IRA and HSA contributions be in print on the heels of Treasury’s decision to delay the income tax filing date for 2019 to July 15 due to effects of the coronavirus.
Taxpayers from until that date to pay taxes owed for 2019 and the first quarter of 2020, as well as to submit last year’s tax gains.
For the 2019 tax year, you can save up to $6,000 in your IRA. If you’re over 50, you can add in another $1,000.
Further, if you have a high-deductible health map with a health savings account, you can stash up to $3,500 if you have self-only coverage. That number goes up to $7,000 for ancestors plans.
Throw in an additional $1,000 toward your HSA if you’re 55 and over.
Saving in both HSAs and IRAs influence a rears a bevy of tax benefits. HSA contributions are tax-deductible or pretax, while IRA contributions can be tax-deductible depending on your income.
Money in an IRA propagates on a tax-deferred basis for retirement. Meanwhile, HSA dollars grow free of taxes and can be used tax-free for qualified medical expenses.
Multitudinous from Smart Tax Planning:
Tax Day is July 15. Why you should get your return in sooner
Congress may allow you to take $100,000 from your 401(k)
How those coronavirus-fueled impoverishments can cut your taxes