3 New Startup 401(k) Tax Credits
When Congress passed the Secure Act 2.0 in December 2022, they introduced new tax credits and enhanced old tax credits for startup 401(k) plans for plan years 2023 and beyond. There are now 3 different tax credits that are available, all in the same year, for startup 401(k) plans that now only help companies to subsidize the cost of sponsoring a retirement plan but also to offset employer contributions made to the employee to enhance a company’s overall benefits package.
Why Did Silicon Valley Bank Fail? The Contagion Risk
This week, Silicon Valley Bank (SVB), the 16th largest bank in the United States, became insolvent in a matter of 48 hours. The bank now sits in the hands of the FDIC which has sent ripples across the financial markets.
529 to Roth IRA Transfers: A New Backdoor Roth Contribution Strategy Is Born
With the passing of the Secure Act 2.0, starting in 2024, owners of 529 accounts will now have the ability to transfer up to $35,000 from their 529 college savings account directly to a Roth IRA for the beneficiary of the account. While on the surface, this would just seem like a fantastic new option for parents that have money leftover in 529 accounts for their children, it is potentially much more than that. In creating this new rule, the IRS may have inadvertently opened up a new way for high-income earners to move up to $35,000 into a Roth IRA, creating a new “backdoor Roth IRA contribution” strategy for high-income earners and their family members.
Top 10 Things To Know About Filing A Tax Extension
Are you considering filing for a tax extension? It can be a great way to give yourself more time to organize your financial documents and ensure that the information on your return is accurate. But before you file the extension, here are a few things you should know.
Mandatory Roth Catch-up Contributions for High Wage Earners - Secure Act 2.0
Starting in 2026, individuals that make over $145,000 in wages will no longer be able to make pre-tax catch-up contributions to their employer-sponsored retirement plan. Instead, they will be forced to make catch-up contributions in Roth dollars which means that they will no longer receive a tax deduction for those contributions.
Secure Act 2.0: Roth Simple IRA Contributions Beginning in 2023
With the passage of the Secure Act 2.0, for the first time ever, starting in 2023, taxpayers will be allowed to make ROTH contributions to Simple IRAs. Prior to 2023, only pre-tax contributions were allowed to be made to Simple IRA plans.
Secure Act 2.0: RMD Start Age Pushed Back to 73 Starting in 2023
On December 23, 2022, Congress passed the Secure Act 2.0, which moved the required minimum distribution (RMD) age from the current age of 72 out to age 73 starting in 2023. They also went one step further and included in the new law bill an automatic increase in the RMD beginning in 2033, extending the RMD start age to 75.
2023 Market Outlook: A New Problem Emerges
While the markets are still very focused on the battle with inflation, a new problem is going to emerge in 2023 that is going to take it’s place. The markets have experienced a relief rally in November and December but we expect the rally to fade quickly going into 2023.
