While it is easy to get caught-up in the buzz of things that must be done in the spring you definitely do not want to forget to consider taking a look at your 2025 income and consider some planning ideas that may save you some taxes next spring when you file your 2025 return. For instance, you may want to ensure that your withholding is properly adjusted based on your 2025 income. Early in the year is also a great time to consider qualified charitable contributions that you would like to make from your IRA as part of your 2025 RMD and have the conversation with your investment advisor to ensure those are properly handled when your RMD’s are paid out.
We would also suggest thinking about some important tax-deductible items that could help you save money on your 2024 tax bill but may need to be considered and handled before you head out to water your tulips.
Deductible Items due by 4/15/2025:
Traditional IRA Contributions-2024 Annual limit $7,000 ($8,000 if you are 50 or older)
ROTH IRA Contributions-2024 Annual limit $7,000 ($8,000 if you are 50 or older)
HSA Contributions-2024 Annual limit $4,150 for those with self-only coverage or $8,300 for those with family coverage
Deductible Items due by 10/15/2025 for those with properly extended tax return:
Contributions to a SOLO 401K-2024 Annual employee $23,000 ($30,500 if you are 50 or older) - Employer limit is still 25% of compensation up to a total combined contribution of no more than $69,000 ($76,500 if you are 50 or older).
Contributions to a SEP IRA can’t exceed $69,000 or 25% of the first $345,000 of compensation, whichever is lower.
As always, for help with 2025 planning or 2024 retirement contribution questions; feel free to reach out to us!
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