Individuals have extra time to tuck cash into their IRA this tax season, now that the income-tax submitting deadline has been postponed a month.
Virtually two weeks after the Inside Income Service extended this year’s federal income-tax filing deadline to Might 17, the tax-collection company on Monday stated the deadline for 2020 contributions to particular person retirement accounts (IRAs) and well being financial savings accounts (HSAs) can also be Might 17.
The 2020 contribution finish dates for each forms of accounts would have been April 15, just like the income-tax submitting deadline earlier than it was pushed again.
An individual underneath age 50 can contribute $6,000 to their IRA, and an individual 50 and above can contribute as much as $7,000. These contributions is perhaps totally or partially deductible, relying on the taxpayer’s revenue and their entry to a retirement plan by means of their employer, in accordance with IRS rules.
An individual with a well being financial savings account can contribute $3,550 for particular person protection and $7,100 for household protection. Well being financial savings accounts are paired with a high-deductible well being plan, the place the deductible is no less than $1,400 for a person and $2,800 for a household. An individual’s contributions to the account are deductible.
The Might 17 deadline is the top date to pay any taxes due within the 2020 tax yr. A taxpayer can get an extension to file a return by means of Oct. 15.
The IRS nudged again different deadlines to Might 17 from April 15, together with the three-year deadline to file a tax return and procure an unclaimed refund. Cash that goes unclaimed previous the three-year window reverts again to the Treasury Division, the IRS famous.
However the IRS reiterated Monday it was not postponing the primary spherical of estimated 2021 tax funds. These funds are nonetheless due April 15, the company famous.
Gig employees, freelancers and self-employed enterprise house owners are a few of the individuals who pay 4 rounds of estimated tax funds. Whereas employers frequently withhold cash for revenue taxes from every paycheck, self-employed taxpayers must pay taxes as they go, by way of estimated funds. Paying too little alongside the best way would possibly lead to penalties.