8 Common IRA Mistakes that Impact Your Retirement Savings

Posted by on Mar 27, 2017 in Blog | 0 comments

IRA mistakes

Individual Retirement Accounts, or IRAs, are particularly useful tools for retirement planning. It’s important to make the most of your IRA while you’re still young, so you have a larger nest egg to fall back on later in life.

Here are 8 common IRA mistakes that might be taking a toll on your retirement savings:

  1. Not Contributing to It:
    This is by far the most serious mistake you can make, even if it’s only one year that you don’t contribute. Most of your retirement income will come from money you’ve saved in the account, not the gains on those savings. However, missing a single year means losing out on compound growth for years, so if you meet the eligibility criteria, put in as much as you can.
  2. Not Contributing Enough:
    Traditional and Roth IRAs allow you to contribute $5,500 a year, or $6,500 after you turn 50. Contribution limits apply together to all IRAs you own, so you can’t contribute $5,500 to each. However, contributing the maximum possible lets you set up a tidy retirement nest egg and enjoy tax benefits from these savings too.
  3. Not Exploring Tax Benefits:
    Different tax rules apply to traditional and Roth IRAs, so consider how these fit your unique needs. The former is funded with pre-tax contributions and taxes apply to gains and withdrawals. This helps if you’re in a high tax bracket now and expect to be in a lower one after retirement. With Roth IRAs, it’s the opposite.
  4. Not Taking Distributions:
    Traditional IRAs have required minimum distributions (RMDs) that start at when you turn 70½. Not taking them, or taking less than the minimum, could leave you with tax penalties of up to 50%. Roth IRAs don’t have RMDs, unless the account is left to a non-spouse beneficiary after your death, so use them if you expect to receive social security benefits or other income after retirement.
  5. Selecting the Wrong IRA Type:
    Most people open traditional IRAs without exploring other options, such as SIMPLE or SEP-IRAs for self-employed individuals. Roth IRAs offer tax-free growth and withdrawals after retirement, so they’re perfect for those who expect to be in a higher tax bracket when they retire or prefer not to take RMDs and let their money keep growing.
  6. Not Meeting Rollover Deadlines:
    When you change jobs, you can rollover your old 401k to an IRA without tax liabilities or early withdrawal penalties. However, you need to deposit the funds within 60 days, which can be difficult. Opt for a direct rollover if possible, and remember that you can also do this only once every 365 days, for all your IRAs together.
  7. Not Investing Effectively:
    IRAs allow you to choose where your money is invested, and too many people make the mistake of investing in conservative options alone. Diversify your investments with a healthy balance of high-risk, high-return vehicles and more stable, low-interest ones to maximize your gains without putting your money at excessive risk.
  8. Not Adding Beneficiaries:
    It might seem like your will and estate documents clarify who gets your IRA savings when you pass on, but you should fill out beneficiary forms properly. Otherwise, your retirement savings could end up going to the wrong person, or make them liable for extra taxes. Get professional assistance if you’re not sure how to do this right.

IRAs could be the most powerful personal finance tool for your future income, so learn how to use them to the best advantage now for a happy, safe and comfortable retirement!

5 Smart Ways to Maximize Your Retirement Savings with an IRA

Posted by on Mar 20, 2017 in Blog | 0 comments

Retirement Savings with an IRA


Whether you already have an IRA or are planning to open one, there are a few things you should keep in mind. This account is more than a “piggy bank” where you put away extra cash every few years, but can prove to be a valuable personal finance tool for your future security. In fact, it’s likely to be your main source of retirement income.

These 5 tips will help you save the right way, improve gains and leverage tax benefits for your IRA:

1. Save As Much As Possible 
Maximize your contributions as far as possible, since compound interest allows even small sums to grow tremendously over time. Aim for the maximum limit, which is $5,500 for those under the age of 50 and an additional $1,000 in catch-up contributions after you turn 50.

If you invest $5,500 per year at an average interest rate of 8%, you will have over $160,000 in the account after 15 years. The earlier you start, the more you will have by the time you retire, and catch-up contributions after the age of 50 let you boost your retirement savings even further.

2. Invest in a Roth IRA 
Consider investing in a Roth IRA if you’re still a long way from retirement, unless you’re self-employed (in which case an SEP-IRA or SIMPLE plan is better). A Roth IRA is funded with post-tax contributions, but your earnings and withdrawals are tax-free as long as you follow the rules.

There’s no required minimum distribution either, unlike a traditional IRA. Roth IRAs can be very helpful if you don’t need money from the account, expect to receive Social Security benefits or think you will be in a higher tax bracket by the time you retire.

3. Roth IRA Conversions 
It’s a good idea to convert your traditional IRA into a Roth IRA if you’ve already got savings in the latter. While you will pay tax on the amount you’re converting, the interest on that money will continue to grow tax-free over the years. This could be a very smart move, especially if you time it right.

A bad year when your taxable income is very low is a good time to convert traditional IRA funds without paying extra taxes. Another good time is when your traditional IRA assets drop in value due to market fluctuations, since your tax bill will be lower.

4. Rollover Your 401k 
When you’re changing jobs, you can rollover your old 401k savings into your new employer’s defined contribution plan or into an IRA. This is a better choice than cashing out your funds, since you will be liable for taxes as well as a 10% early-withdrawal penalty if you’re under the age of 59½.

Rolling over to an IRA instead of another 401k allows you to choose where these funds will be invested, and fees are often lower too. Just ensure you choose the right IRA based on the type of defined contribution plan, e.g. rollovers from traditional 401k plans to Roth IRAs are not tax-free.

5. Watch the Fees 
No matter what IRA type you choose, pay attention to any commissions and fees that will be applicable. These can cut into your gains if you aren’t careful, so shop around to find the best financial vehicles, services and brokerage options.

Remember that IRA contribution limits apply to all the money you invest, even if it’s in multiple accounts. Save and invest wisely today, so you have a sizeable chunk of money by the time you retire!

Tax Planning for Entrepreneurs: Are SEP IRA Contributions Tax Deductible?

Posted by on Mar 13, 2017 in Blog | 0 comments

SEP IRA Tax Deductible


Owning and running your own business or even freelancing gives you the independence and freedom of doing what you want, on your terms. It is indeed a powerful feeling. But, where there is such freedom, there is a catch, what about saving for retirement? Who will do that for you?

For business owners, freelancers and self-employed individuals, a Simplified Employee Pension or SEP IRA is a great way to save for retirement, help employees build a nest egg and take some tax credit in the process. Let’s take a closer look at the tax advantages offered by these plans.

Are SEP IRA Contributions Tax Deductible for Employers and Employees?

Contributions made to an employee’s SEP IRA are tax deductible only for employers, who can claim a certain limit on business tax returns. Contributions made by a sole proprietor may be claimed on personal tax returns.

Contributions are not taxable for employees, and earnings in the form of interest or gains from investments are tax-deferred. Income tax is also applied on withdrawals made from the account, as well as a 10% early withdrawal fee on distributions taken before the age of 59½ years.

What is the Eligibility Criteria for an SEP IRA?

All eligible employees must be included in an employer’s SEP IRA, and the eligibility criteria is the same for everyone, including owners. To participate, employees must be at least 21 years old. They should have worked for the business for 3 of the last 5 years, and received a compensation of $600 or above from the business during the plan year.

Plans may be set up with a lower minimum age or period of employment. Employees who may be excluded from the plan include non-U.S. residents with no U.S. source compensation and those who enjoy retirement benefits as part of their employees’ union agreement.

What Are the SEP IRA Contribution Limits?

  • An employer can contribute up to 25% of each eligible employee’s annual compensation or $53,000, whichever is lower. This limit applies to contributions that they make to their own SEP IRA as well.
  • Employees cannot make contributions to an SEP IRA, although they own the funds in the account. Employers choose what percentage is contributed from their pay, or whether to contribute to the plan at all.
  • Owners of a business with no employees may also contribute 25% up to a maximum of $53,000 from their net profits. However, they cannot make a contribution if the business shows a net loss at the end of the year.
  • The same SEP IRA contribution limits apply to freelancers and self-employed professionals, but different rules are used to calculate the percentage of earnings that can be claimed as tax deductions.
  • If an employee puts money into another defined contribution plan in the same year, the total amount of both contributions cannot be higher than the SEP IRA contribution limits.
  • Business owners with employees cannot contribute to their own SEP IRA unless they make an equal percentage of contributions for every eligible employee.

SEP IRAs let you make tax deductible IRA contributions for yourself and your employees in a simple and inexpensive manner. If you’d like to learn more, get in touch with the experts at Self Directed Retirement Plans today!

SEP IRA: What Is It and How Does It Work?

Posted by on Mar 3, 2017 in Blog | 0 comments



If you’re an entrepreneur or self-employed, no one provides you with a pension plan. It’s important to build a retirement fund to support yourself and/or your dependents when you retire. If you have employees, you may also want to set up a retirement plan for them, and enjoy some tax breaks in the process!

Enter the Simplified Employee Pension plan, also known as an SEP or SEP IRA. Let’s look at what this plan offers, how it works, and how you can use it.

What is a SEP IRA?

SEP IRAs are employer-sponsored retirement plans that allow employers to make tax-deductible contributions to a retirement fund on behalf of an eligible employee. Business owners and self-employed individuals can also use these IRA-based plans to save money for their own retirement, whether they work full-time or part-time.

Setting Up an SEP IRA

SEP IRAs are easy and inexpensive to set up, and available to businesses of any size, including sole proprietors, partnerships and corporations. The account needs to be opened with any qualified financial institution such as a bank or insurance company, after completing Form 5305-SEP.

Employees and business owners need to have a traditional IRA to be eligible for an SEP. It’s often easiest to open and maintain SEP IRAs for eligible employees if a single financial institution is used for all the accounts.

SEP IRA Rules to Keep in Mind

Business owners who set up an SEP IRA for themselves also have to create one for each eligible employee, and offer a uniform contribution rate for everyone. If you as an employer put 10% of your pay into an SEP IRA, you must contribute an equal percentage of each eligible employee’s pay as well.

Tax-deductible contributions to SEP IRA plans can be made up to the employer’s tax filing date. You can also opt not to make any contributions during a slow year, but then you cannot make an SEP IRA contribution for yourself either.

How Does an SEP IRA Work?

SEPs are quite similar to traditional IRAs, and here are some basic points about how they work:

Ownership and Control – Employees and business owners retain control of the account, and are responsible for choosing which stocks, mutual funds or other vehicles their funds will be invested in.

  • Portability:
    Employees and business owners can take the account with them if they leave an employer or the business closes down. They can also opt for a transfer or rollover of these funds to another IRA or 401(k).
  • Contributions:
    Employees cannot choose how much their SEP IRA contribution will be, and cannot make contributions on their own behalf. Employers decide what percentage of pay will be contributed for every eligible employee on an annual basis, if any.
  • Distributions:
    Withdrawals from the plan are taxed as ordinary income to the owner of the account. Distributions also incur a 10% early withdrawal penalty if they are made before the account owner turns 59½. Like traditional IRAs, required minimum distributions begin after 70½ years of age.
  • Taxes:
    Employers can claim employee contributions as deductions on business tax returns. Sole proprietors’ contributions can be claimed on personal tax returns. Contributions do not incur taxes for the account owner, but earnings such as interest or gains from investment are taxable.
  • SEP IRA Contribution Limits:
    TheSEP IRA contribution limit is higher than standard IRAs, and employers can contribute up to $53,000 or 25% of an employee’s eligible compensation, whichever is lower. If an employee owns another defined contribution plan, the total annual contribution for both cannot exceed $53,000.

Remember, SEP IRA contribution for self-employed individuals is more complex, so it’s a good idea to consult a professional for expert advice. At Self-Directed Retirement Plans, our advisors would be glad to help with your questions. Call us to discuss your retirement planning needs today!

Investing in Real Estate with IRA Money: What Are Your Options?

Posted by on Feb 24, 2017 in Blog | 0 comments

IRA investment options

Funds in your IRA are usually off-limit till you reach the age of 59½, unless you want to pay a 10% penalty for early withdrawals. However, there are some exceptions for those who want to use IRA funds to purchase an investment property.

Tapping into your nest egg may seem like the only solution when you’re looking at huge down payments. Still, it’s best to avoid dipping into your retirement fund unless you qualify for the first-time homebuyer exemption, or have no other choice.

Let’s consider the options available when you want to use IRA to buy a house, or build/rebuild your first home.

Using an IRA to Buy a Home

If you have savings parked in an IRA, here’s how you can use them to buy a home:

  • The first step is to check whether you or your spouse qualify as a first-time homebuyer, i.e. someone who hasn’t owned a primary residence in the last 2 years.
  • According to the IRS, if you own a cottage or recreational property, or owned a home more than 2 years back, you still count as a first-time homebuyer.
  • As a first-time homebuyer, you can use up to $10,000 from your traditional IRA without paying an early withdrawal penalty.
  • You can also make a penalty-free $10,000 withdrawal if you’re helping your parent, spouse, child or grandchild buy a house.
  • If you’re buying property jointly with your spouse, both of you can withdraw $10,000 each. This is a lifetime limit and can only be used once.
  • You can use traditional IRA funds for down payments, as well as building/repair costs, financing fees, closing costs and other acquisition expenses.
  • Income tax still applies on your withdrawal, so take federal and state taxes into account while deciding how much to spend on your home.
  • After withdrawing money from a traditional IRA, you face a 10% penalty if you don’t begin construction or buy your house within 120 days.
  • Make sure to keep dated copies of construction/purchase contracts as well as any other documents you’ve signed for your new home.

Using a Roth IRA to Buy a Home

Here’s how you can use your Roth IRA savings to pay for a real estate purchase:

  • You can make tax and penalty-free withdrawals at any time, but only from contributions, i.e. funds you’ve put into the Roth IRA.
  • Remember you have already paid the tax on the Roth contributions.
  • Withdrawals are not taxed if you are just withdrawing your contributions not invading any gains.
  • Having said that if you’re a first-time homebuyer, consider making a withdrawal from your contributions first, so your gains can continue to earn interest.
  • You need to buy or begin construction on your new home within 120 days if you make a withdrawal from Roth IRA earnings.
  • If you don’t qualify as a first-time homebuyer or cannot meet the 120-day limit, draw on contributions instead. These are not restricted, taxed or penalized.
  • Roth IRAs are only available if your annual income is under a certain limit. Use these funds now if you think your income might be higher in the future.

Using a Self-Directed IRA to Purchase Real Estate

Converting your IRA into a self-directed IRA (SDIRA) allows you to choose where your contributions are invested. You can use a self-directed IRA to purchase real estate of any kind. However, you and your immediate family cannot benefit from these investments till you’re 59½ years of age.

This is a great way to make a real estate investment for your golden years.  Your renter will pay down the mortgage over the time. As retirement becomes more of a clear reality, you will put in place a distribution policy so when the day comes, the house is yours.

This strategy is not a good one if you want to buy a home and live in it before retirement. If you’d like to learn more about how an SDIRA works, our expert advisors are here to help!

Zip Code Zen – Picking the Right State for a Better Retirement

Posted by on Feb 13, 2017 in Blog | 0 comments


Average life expectancy figures continue to rise and that means that you have a better chance of spending a lot more golden years on this planet that your predecessors.


That fact alone suggests you should choose your retirement destination with a great deal of care, as it will be your final surroundings for some time to come if you enjoy a good run at your senior years.

If you are looking for a list of attractive features to justify moving to a new state for your retirement it is a fair guess that somewhere with a good sunshine record might get a lot of the votes, but should you pick a place just because it offers some of the best weather?

When you are trying to decide which states are the best retirement destination there are plenty of other factors that could be considered just as important as the average hours of sunshine on offer.

Cost of living expenses and taxes are another two key factors to look at alongside how good the weather is outside. Some areas are clearly more expensive to live in than others so you might want to pick a place where you get more for every dollar you have to spend each year on your retirement plans, and some states are d

ly more retirement-friendly than others when it comes to taxes.

Seeing as you might live to a ripe old age in retirement, it makes a lot of sense to consider your retirement destination with a great deal of care and thought.

When Should You Consider Contributing to a Roth IRA

Posted by on Jan 23, 2017 in Blog | 0 comments

Difference between Roth IRA and Traditional IRA

Hesitant about contributing your hard earned cash to a Roth IRA?

There are a number of plans that will help you build your retirement savings that can ensure that you will enjoy a comfortable life in your golden years. Some of these plans include 401(k), traditional IRA, Roth IRA, etc. It is fairly normal to get confused regarding where to contribute your hard earned money. In this article, we will be focusing on five situations where contributing to a Roth IRA would make sense for you.

If You Still Have a Long Career Ahead of You
If you have recently begun your professional career, it means that your income will grow through the years to come and will eventually put you in a higher marginal tax bracket. Now, all the distributions from Roth IRA are tax-free and they won’t count toward your income during retirement. Roth IRA would be a great idea if you expect to be in a higher tax bracket when you turn 60 as compared to when you are in your 20s or 30s. Regardless of how much you withdraw from the Roth account, you won’t be pushed into the higher tax bracket after you retire.

If You Think the Tax Rates will Rise
If you think that the tax rates will shoot up in the near future, you should start making preparations to create a Roth IRA account. It isn’t uncommon for the U.S Congress to boost revenue to clear the debt by hiking the tax rates across the board. If you contribute to Roth IRA, you can enjoy the benefits of taking out tax-free contributions and cushion yourself from the uncertainty of the tax future.

If You don’t Like RMDs
You need not take RMDs (Required Minimum Distribution) in Roth IRA, which differentiates it from 401(k)s or traditional IRAs. There will be occasions where you wouldn’t need an annual distribution but with 401(k) and traditional IRA you would still have to withdraw the minimum amount. This isn’t the case with Roth IRA. You can allow your IRAs to grow for as long as you want without withdrawing any money. Additionally, you can make the withdrawals in any increment as they will have no effect on modified adjusted gross income.

If You Want to Access your Cash in Case of an Emergency
Roth IRA allows you to have financial flexibility by ensuring that you have access to cash in any case of emergency. As the contributions are made with after-tax dollars, you can remove them at any time, for any reason, without paying any penalty or tax.

If You want a Tax-Free Income for your Family and Heirs
If you are looking forward to passing along your tax-free money to your heirs upon your passing, then Roth IRA would be a great option to consider. Your assets will compound through the years and your beneficiaries would be left with a sizable inheritance, which they can withdraw without paying any tax on it.

If you need any help with retirement planning, get in touch with us SD Retirement Plans today!

How to Get Penalty-Free Retirement Withdrawals at the Age of 55

Posted by on Jan 16, 2017 in Blog | 0 comments


You want penalty-free retirement withdrawals as much as the next day right?

If you invest in various plans such as IRA and 401(k), then you would know that for tapping a 401(k) free of the 10% early withdrawal penalty, you have to be at least 59½ years of age. But what if you want to retire earlier than that, say by the age of 55, and still be able to take out penalty-free distributions? The good news is you can. Are the ‘hows’ and ‘whens’ already running through your mind? The following points will answer all your questions.

The Exception
The one exception to being able to tap into your retirement savings early and not paying any penalty on the withdrawals is that you have to leave your employer in the year you turn 55 or older. If you do so, you can take distributions from your 401(k) without penalty but you would still owe tax on the withdrawals. For example, you have to pay $2,500 on a $10,000 payout at a 25% tax rate but you will avoid the 10% ($1,000 in this case) early withdrawal penalty.

It doesn’t really matter how you part ways with your employer. You can retire, get laid off or even get fired, but as long as you are 55 years by the end of the year you leave the job, the rule will apply. If you leave your job in January and turn 55 in December, then the 401(k) or 403(b) payouts anytime during the year are penalty-free. However, if you retire in December and turn 55 the following January, you will be stuck with the penalty until you turn 59½ years.

Plans Supporting this Exemption
It is important to remember that this exemption is only applicable to the funds in your 401(k) and 403(b) accounts. You must already be familiar with the former, let’s take a quick peek into the latter.

403(b) is a retirement plan that is created for certain employees of the non-profit sector, public school, and tax-exempt organizations and ministers. Individual 403(b) accounts are established and maintained by eligible employees. Those with the 403(b) plan have the ability to match payroll-deducted contributions, which is an employment incentive. These contributions then grow tax-free, often for decades, resulting in a significant increase in the initial investment.

If you turn 55 the year you leave your employer, you can withdraw penalty-free income through these two accounts, however if you decide to roll those funds over into an IRA after you leave your job and then want to withdraw some money, you’ll be subjected the 10% early withdrawal penalty until you turn 59½.

So, go through all your options carefully during retirement planning and choose the plan that benefits you the most. We, at SD Retirement Plans, can guide you through this process efficiently, so that you get maximized benefits from the plan.

Understanding Different Phases of Creating Retirement Income

Posted by on Jan 9, 2017 in Blog | 0 comments

saving for retirement


Are you worried about retiring without stress? Read on to find out how you can do just that.

Retirement income, savings, IRA, 401(k)s, assets — these are just some of the words that you will hear quite frequently during your professional life. Going through the ups and downs of your career and planning for your retirement, which may be thirty-forty years from now, may seem really overwhelming, but unfortunately it is something you have to pay attention to early on in your career. In this article, we addressed different retirement related issues and phases that you will probably find yourself facing in the near future.

Learning How to Create Retirement Income
There is a certain lifestyle you must be living right now and you probably would want to continue with the same lifestyle after you retire as well. To achieve this, you need to know how much money you would need in the future so that you don’t have to compromise on how you live. You do not want to end up with a depleted bank account when you still have a couple of retirement years ahead of you. So, how do you plan it? Read here to know more.

Different Ways to Generate Retirement Income
For you to be able to enjoy your golden years, you have to make sure that you generate a sizable retirement income. There are a number of ways to achieve this. Let us look at 9 ways to generate retirement income that will assure you of a comfortable retirement.

Creating a Retirement Income that Responds Well to Unexpected Events
Just planning for retirement and contributing to various plans isn’t enough. It is equally important that you build a diversified income plan which not only ensures that you have enough moolah in the savings account but that it can also respond well to unpredictable events that have the potential to harm your income. Here we can learn about the different factors that you must consider while building a diversified income plan so that you never feel the pinch of tough times if you come across any.

How to Design a Retirement Income Portfolio
Your job doesn’t end at coming up with techniques on how to save and invest for your retirement. You have to also put emphasis on how to use your retirement savings for the rest of the retirement. Stretching out a fixed income over the non-working years can get quite taxing if it’s not planned properly. Imagine you retire at 70 and have to utilize your income till your passing, say anywhere between 80-100 years. This means that you have to ensure that your retirement portfolio can support you and your family for around 10-30 years. Here is how you can do that:

How to Generate Retirement Income More Efficiently
Retirement planning doesn’t just consist of accumulating assets. You have to focus on how you plan to distribute your assets and inheritance to your heir(s) as well. There are a number of factors that you must consider to ensure that you keep generating retirement income in an efficient manner, such as the amount you withdraw each month, how to protect your savings, facing turbulent events, etc. Let us look at how you can generate retirement income more efficiently to ensure a comfortable post-retirement life.

If you need any help pertaining to retirement planning, feel free to get in touch with us at SD Retirement Plans.

Highlights of the IRA and 401K Announcements for 2017

Posted by on Jan 2, 2017 in Blog | 0 comments



As per the latest IRS announcement, there’s no change in the 2017 contribution limits for IRA and 401(k) savings. However, there are other tweaks that will help workers, small business owners and self-employed individuals put more after-tax money into their retirement savings.

Self-employed individuals and small business owners can now save $54,000 in an SEP IRA or Solo 401K (up from $53,000 in 2016), and the new compensation limit is $270,000 (from $265,000 in 2016).

For workers under the age of 50, the maximum IRA contribution is $5,500, and $18,000 for 401K accounts. With catch-up contributions set at $1,000 for IRAs and $6,000 for 401Ks, these limits have remained unchanged through 2015 and 2016.

Changes to Income Limits: Traditional and Roth IRA
The main changes to retirement plans in 2017 are found in the maximum income limit for Roth IRAs and traditional IRA plans. These minor changes have no bearing on contribution limits, only on the income phase-out limit for contributing to a Roth IRA or taking tax deductions on traditional IRAs.

Here’s the new AGI (adjusted gross income) limit for both plans:

  • Income Limits for Traditional IRAs – With a traditional IRA, the amount of money you earn has no effect on your ability to contribute to the account. The restriction lies in tax-deductible contributions to the IRA, which are affected by your AGI as well as employer-provided retirement savings.
    • What has Changed?
      If you’re covered by an employer plan and filing as the single/head of household, the new AGI threshold is $62,000-$72,000 (from $61,000-$71,000 in 2016). For filing jointly with your spouse, the new AGI threshold is $99,000-$119,000 (from $98,000-$118,000 in 2016).If you’re filing jointly and your spouse is covered by an employer plan (but you aren’t), the AGI threshold is now $186,000-$196,000 (from $184,000-$194,000 in 2016).
    • What hasn’t Changed?
      If you’re single and not covered by an employer plan, or filing jointly and neither you nor your spouse are covered by an employer plan, there’s no income limit applicable. If either you or your spouse are covered by an employer plan, and you’re married but filing separately, the AGI threshold remains $0-$10,000.
  • Income Limits for Roth IRAs – Your ability to make direct contributions to a Roth IRA is restricted, based on a maximum AGI threshold. If you’re above the threshold, the only way to get around this is by investing in a traditional IRA and then converting it to a Roth IRA right away.
    • What has Changed?
      If you’re filing as single, the new AGI threshold is $118,000-$133,000 (from $117,000-$132,000 in 2016).
      If you’re filing jointly with your spouse, the new AGI threshold is $186,000-$196,000 (from $184,000-$194,000 in 2016).
    • What hasn’t Changed?
      If you’re married but filing separately, the AGI limit remains $0-$10,000.
      The additional tax breaks in 2017 are designed to encourage retirement planning efforts (reducing reliance on social security) among the younger generation as well as those nearing retirement. Make the most of these and other tax breaks now!