What the IRS Filing Extension Means for 2019 IRA Contributions
April 6, 2020 |
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Recently, the Internal Revenue Service (IRS) extended the deadlines to FILE and PAY federal taxes from April 15, 2020 to July 15, 2020.
As a result, you can now make IRA contributions for 2019 up to the new extended deadline date1.
Who is eligible for this extension?
Any person with a Federal income tax return or payment2 due on April 15, 2020, is eligible. You can visit IRS.gov for more details.
You can still make 2019 IRA contributions
If you haven’t already filed your 2019 tax return, here are actions you can still take to lower your taxes.
Contribute to a Traditional IRA
For pre-tax benefit, you can contribute up to $6,000 to a traditional IRA. And, if you’re over 50, you can make and additional catch-up contribution of $1,000 to that IRA.
Increase your 401K contribution
If you’re currently participating in your employer’s 401(k) retirement plan, you can contribute up to $19,000 to a 401(k). You can also make an additional catch-up contribution of $6,000 if you’re over 50.
Smart Choices from Dime
Now that you’re more informed, let’s get started on helping you make the right choice for your traditional IRA3. Dime Community Bank provides smart choices for your retirement savings. Visit dime.com/IRA to learn more. Or, schedule an appointment with a Dime IRA specialist at any Dime branch location.
1 In Notice 2020-18 (PDF), the Treasury Department and the Internal Revenue Service (IRS) announced special Federal income tax return filing and payment relief in response to the ongoing Coronavirus Disease 2019 (COVID-19) emergency. For more details on IRA contributions, see Publication 590-A, Contributions to Individual Retirement Arrangements (IRAs).
2 The payment due refers to both 2019 Federal income tax payments (including payments of tax on self-employment income) and 2020 estimated Federal income tax payments (including payments of tax on self-employment income), regardless of the amount owed. The return or payment must be due on April 15, 2020 – this relief does not apply to Federal income tax returns and payments due on any other date.
3 Make sure you speak to a tax advisor and visit IRS.gov for details regarding IRA eligibility, contribution and distribution rules.