The IRS just announced increased contribution limits for IRAs and many retirement plans. IRAs now have a $6000 limit, 401(k) $19,000 on the employee side, and SEPs $56,000 limit.
This is another win for investors and savers in a year where so many tax laws have changed. The new maximum contribution is the amount you can choose to add to your IRA (if you qualify) or 401(k) or SEP pre-tax and it will grow in these accounts tax-deferred until you take it out during retirement.
It may seem like normal course of annual updates but this is the first increase in IRA contributions since they set at $5500 in 2013 (and contribution limits were stuck from 1982 to 2001 at just $20000. For so long there were really no cost of living increases in the IRA and Qualified plan contribution limits so it a great opportunity for so many to be more prepared for retirement.Read More