“Failing to comply with contribution limits in your IRA and other savings plans can cause complications with the IRS you want to avoid."
Fort Myers, FL (PRWEB) November 03, 2014
The new contribution limits for retirement plans have finally been announced by the IRS. There are a few changes in how much money is allowed to be contributed for individuals who participate in employer-sponsored plans.
In 2014, the maximum employee contribution to a 401(k), 403(b), 457, and federal thrift savings plan was $17,500. As of 2015 the new contribution limit increases to $18,000. The catch-up contribution limit also increases. In the past an employee of the age of 50 or older could contribute $5,500 but in 2015 rises to $6,000. Therefore, individuals with a 401(k), 403(b), 457, or thrift savings plan who are over the age of 50 can contribute a maximum amount of $24,000 beginning in 2015.
The contribution limits to a SIMPLE plan available to self-employed individuals, have also increased. The contribution limit was previously $12,000 and in 2015 it will increase by $500 to a maximum contribution limit of $12,500. The catch-up limit has also been raised from $2,500 to $3,000.
There have been no changes on how much a person can contribute to a traditional or Roth IRA. In 2014 and in 2015 the contribution limits remain the same. The maximum contribution limit is $5,500 for a traditional or Roth IRA, and the catch-up limit for individuals 50 or older is still $1,000.
These contribution limits apply to self-directed retirement accounts and non-self-directed accounts. Non-self-directed retirement accounts limit investors to only stocks, bonds and mutual funds. Self-directed IRAs allow investors to invest in alternative assets such as real estate, notes and mortgages, foreign currency, private placements, and checkbook-control LLCs. “Contributing to a self-directed retirement plan gives investors the freedom of choice to invest in assets that they know and understand” says Dave Owens, managing partner at AdvantaIRA Trust.
Regardless of the retirement plan, it is important to follow the IRS rules by knowing how much is allowed to be contributed each year. “Failing to comply with contribution limits in your IRA and other savings plans can cause complications with the IRS you want to avoid,” says Owens.
About AdvantaIRA Trust
AdvantaIRA Trust is a self-directed IRA administrator that provides tax-deferred and tax-free investment opportunities, superior customer service, and educational tools to assist investors in realizing the maximum benefits possible within IRAs. AdvantaIRA makes it easy to use self-directed retirement plans to invest in assets that the individual investor knows, understands, and can control. To learn more visit www(dot)AdvantaIRA(dot)com or call 239-333-4913.
About Dave Owens
Dave Owens is the managing partner at AdvantaIRA Trust in Fort Myers, Miami, Gainesville, New England, and the Florida Panhandle. Owens opened the AdvantaIRA Trust headquarters in Fort Myers, FL in 2003. His background as a certified public accountant, combined with a long history of personal retirement self-direction, provides his audiences and clients with solid advice and practical solutions to their IRA investment questions. Dave holds a BS in accounting from Purdue University. He also earned the prestigious Certified Exchange Specialist designation through the Federation of Exchange Accommodators.