As part of your 2021 tax planning, now is the time to review funding your retirement accounts. By establishing your contribution goals at the beginning of each year, the financial impact of saving for your future should be more manageable. Here are annual contribution limits for 2021:
| Plan | 2020 | 2021 | Change | |
| SIMPLE IRA | Annual Contribution 50 or over catch-up | $13,500 Add $3,000 | $13,500 Add $3,000 | No Change No Change |
| 401(k), 403(b), 457 and SARSEP | Annual Contribution 50 or over catch-up | $19,500 Add $6,500 | $19,500 Add $6,500 | No Change No Change |
| Traditional IRA | Annual Contribution 50 or over catch-up | $6,000 Add $1,000 | $6,000 Add $1,000 | No Change No Change |
| AGI Deduction Phaseouts: | Single; Head of Household Joint nonparticipating spouse Joint participating spouse Married Filing Separately (any spouse participating) | 65,000 – 75,000 196,000 – 206,000 104,000 – 124,000 0 – 10,000 | 66,000 – 76,000 198,000 – 208,000 105,000 – 125,000 0 – 10,000 | + $1,000 + $2,000 + $1,000 No Change |
| Roth IRA | Annual Contribution 50 or over catch-up | $6,000 Add $1,000 | $6,000 Add $1,000 | No Change No Change |
| Contribution Eligibility | Single; Head of Household Married Filing Jointly Married Filing Separately | 124,000 – 139,000 196,000 – 206,000 0 – 10,000 | 125,000 – 140,000 198,000 – 208,000 0 – 10,000 | + $1,000 + $2,000 0 – 10,000 |
| Rollover to Roth Eligibility | Joint, Single, or Head of Household Married Filing Separately | No AGI Limit Allowed / No AGI Limit | No AGI Limit Allowed / No AGI Limit | No AGI Limit Allowed / No AGI Limit |
Take action
If you have not already done so, please consider:
- Reviewing and adjusting your periodic contributions to your retirement savings accounts to take full advantage of the tax advantaged limits
- Setting up new accounts for a spouse or dependent(s)
- Using this time to review the status of your retirement plan
- Reviewing contributions to other tax-advantaged plans including flexible spending accounts and health savings accounts
