The Internal Revenue Service on Friday announced that it would postpone enforcement of a law that would require high-earners to exclusively allocate “catch-up” contributions to Roth-style investment accounts — rather than pre-tax accounts that confer an immediate income tax benefit.
The change in the law, inflicted by December 2022’s SECURE 2.0 Act, stipulated that, starting in 2024, 401(k) participants making catch-up contributions by virtue of being age 50 or older must put those contributions in Roth accounts if their prior-year Social Security wages were more than $145,000. Friday’s announcement means people fitting that description can allocate catch-up contributions to pre-tax accounts for another two years. If this woman were married to a 50-plus 401(k) participant, she could find the rule postponement saves the two of them thousands in current-year tax liabilities Unlike traditional pre-tax contributions, Roth contributions do not reduce a participant’s current-year taxable income and thus don’t provide immediate […]
Read the Whole Article From the Source: www.zerohedge.com
-
Learn the TRUTH about Gold IRAs and how most precious metals companies play dirty.