Contributing to Retirement Accounts

Contributing to Retirement Accounts

January 26, 2021
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If you’re like many investors, you’re probably looking for a way to manage your tax bill. One approach to consider is contributing the full amount to your retirement accounts.

 

It’s not too late to fund your retirement account for 2020. You can fund your retirement accounts for the previous year up until the annual personal tax filing deadline of April 15, 2021. Just make sure that the custodian who takes care of your retirement account is aware that the contribution you are making is for the previous year.1

Here’s another consideration: you may continue to contribute to a Traditional IRA after age 72, under the SECURE Act, as long as you have earned income.

Once you reach age 72, you must begin taking required minimum distributions from a Traditional Individual Retirement Account (IRA) in most circumstances. Withdrawals from Traditional IRAs are taxed as ordinary income, and if taken before age 59½, may be subject to a 10-percent early withdrawal tax unless an exception applies.2

You can contribute to your retirement accounts for 2020 until April 15, 2021. Let’s get together and talk about how we can continue to build your retirement strategy.

James Ptacek may be reached at 440-891-1200 or james.ptacek@lpl.com

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This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

Citations

  1. Efile.com, November 27, 2020
  2. IRS.gov, October 13, 2020.