4th Quarter 2019

Last-Minute Tax Savings for 2019

You have until April 15, 2020, to take advantage of these tax-friendly ways to lower your tax bill or build up tax-advantaged savings for the future.

Save in an IRA. You can contribute up to $6,000 to an IRA for 2019 (or $7,000 if age 50 or older). If you earn an income but your spouse doesn’t, you can contribute to a spousal IRA on his or her behalf. Depending on your income, you may be able to make tax-deductible contributions to a traditional IRA or build tax-free savings in a Roth IRA. See “What is a Roth IRA?” for details.

Save side-gig income. If you had any freelance income in 2019, you can also make tax-deductible contributions to a Simplified Employee Pension. See IRS Publication 560 at www.irs.gov for more information.

Get an extra break for saving. If you contribute to a retirement-savings account through a 457 plan or IRA, for example, you may also qualify for the Saver’s Credit, which reduces your tax liability by $200 to $1,000 per person. Your 2019 adjusted gross income must be less than $38,500 if married filing jointly, $28,875 for head of household, or $19,250 if single. See www.icmarc.org/saverscredit.

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