As the final quarter of the year approaches, older taxpayers need to keep a careful eye on their required minimum distributions (RMDs) for the year. There’s a stiff penalty for not withdrawing enough from a retirement account. This edition of Tax Tip Tuesday explains the rules that apply and offers a strategy for those older taxpayers who would be interested in using the qualified charitable contribution deduction this year, should it be retroactively reinstated by Congress.
The 2012 American Taxpayer Relief Act passed earlier this year has a new opportunity for Roth conversions. Now individuals can convert any portion of their balance in an employer-sponsored tax-deferred retirement plan account into a designated Roth account under that plan. Designated Roth accounts are popular retirement plan options because they offer several advantages, such as: Earnings within the account are tax-sheltered. This is the same with a regular qualified employe
Today we will take a look at the 2013 pension plan limitations, which the IRS recently released. The elective deferral or contribution limit for employees who participate in 401(k) and 403(b) plans will increase from $17,000 to $17,500. The catch-up contribution limit for employees who are 50 years old and older and who participate in 401(k) and 403(b) plans remains unchanged at $5,500. The deferral limitation for SIMPLE retirement accounts will increase from $11,500 to $12,0