401K

IRS Tax Changes for 2018

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The IRS has released its 2018 tax updates via Notice 2017-64 and revenue procedure 2017-58. Highlights are provided below. Remember these updates are for 2018 taxes filed in 2019. For the upcoming 2017-18 tax year, I have included links (for filings due next year by April 17, 2018) where applicable. Personal Tax Brackets The standard deduction for married […]

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2018 401k and 403b Plan Contribution Limits Could Drop Precipitously Under Trump-Republican Tax Reform

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401K and 403b limits have held steady or moderately increased over the last few years with more and more Americans using these tax advantaged employer sponsored vehicles to save for their retirement income. However this bastion of American retirement savings is under attack from Trump and GOP tax reform proposals. Basically to fund proposed tax […]

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Maximum 401k Contribution Limits Up To $55,000 in 2018 – Individual Limits Rise to $18,500

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A lot of people assume the maximum annual contribution to employer sponsored retirement plans like a 401(k), 403(b) or Government Thrift Savings Plan (TSP), are what is published at the individual level. However, this could be very misleading if your employer contribution or match is generous and/or you are a high income earner. In fact […]

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5 Reasons I Max Out My 401k Retirement Account as Fast as I Can – The 25% Contribution Rule

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Every year around November when the IRS publishes updated 401k plan limits for the year ahead I set myself a goal to see how fast I can reach the maximum contribution limit. I am fortunate that I earn and save enough money to make the maximum pre-tax retirement account contributions, but even if you cannot get […]

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Contributing to an IRA and Roth IRA if You Already Have a 401K – Non Deductible IRA and Maximum Tax Deductible Contributions

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“Can I Contribute to an IRA, Roth IRA and a 401K if I have access to all these accounts? What are the limits and rules of doing so?” This is the kind of question I get fairly often and one that I actually had to recently sort out for myself. To determine if and how much you […]

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2016 to 2017 Retirement Plan Contributions and Conversions – How to Reduce your Taxable Income

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In this article we will discuss Retirement Plan Contributions and Conversions and how these can reduce your taxable income in the current tax year. The last business day of 2016 is December 30th, so there is still time to make changes to your contributions to achieve the greatest reduction in your tax liability. The countdown to […]

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The Best Retirement Plans for Young Workers

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It’s not breaking news that you should be saving for retirement. Most employed people understand this fact, so hopefully, you are setting some cash aside for your golden years despite your day to day living expenses. The tricky part of retirement financial planning is figuring out how much you should actually save and where it […]

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2017 vs 2018 Traditional IRA versus Roth IRA – Contribution and Phase-out Income Limits

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I regularly receive reader questions asking me to clarify the difference between a Roth IRA and Traditional IRA plan. Both are excellent retirement investment vehicles, but based on your income and tax situation one may be a better first choice than the other. Shown below is a table with some key differences between the two retirement investment […]

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Which Fund Allocations Should I Choose for My 401K or IRA Contributions in 2016 Given Markets, Economy and Elections

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With the markets rocky, US and global economies facing headwinds and a presidential political campaign in full swing, choosing how to allocate your current and future retirement savings for the medium to longer term is no easy task. But rather than just leave your current 401K and IRA allocations as is amid changing macro and micro […]

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2017 vs 2018 401k, 403b, 457 and TSP Contribution Limits and Catch-up Amounts

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[Updated with the latest 2018 contribution limits] The IRS has released updated employer sponsored retirement plan limits, which covers 401(k), 403(b), 457 and Government Thrift Savings (TSP) plans. The annual contribution limit, which is indexed to inflation increased by $500 in 2018. This means the maximum amount employees will be able to contribute on a pre-tax basis in […]

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