Tax season is upon us and it seems that every year Uncle Sam takes more and more of your hard-earned money. This year, throw a little extra cash in your retirement account and reduce your taxable income as much as possible. Regardless of what type of retirement account you have, this year you are allowed to contribute up to $16,500 of your salary tax-deferred. If you are 50 years old or older you can add an additional $5500 in catch-up contributions this year, raising your yearly total to $22,000. That’s up from $15,500 last year ($21,000 if your over 50), but limits will not increase in 2010 so make sure you take advantage of the boost during this tax year.
If you are self-employed you can shelter even more of your income. As long as you have no employees (other than your spouse) you can open a solo 401k and contribute up to $16,500 ($22,00 if you are over 50) plus your business can kick in up to 20% of your total net income until the total reaches $49,000. If you don’t have the cash to spare right now, you’ll have until you file your ’09 tax return to max out your contribution.
Source
http://www.kiplinger.com/printstory.php?pid=18927
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment