Have an IRA? There are some changes you should know about

An individual retirement account can play a key role in any well-rounded retirement savings strategy. Since there are a lot of rules that govern when and how you can use your IRA, it’s important to research on your own or work closely with a tax advisor to ensure you’re following them all to the letter. 

You’ll want to consult a tax professional to find out exactly how these changes may impact your IRA. In the meantime, here are some highlights to be aware of: 

Contribution limits: The annual contribution limit for IRAs remains $7,000 for 2025. The catch-up contribution limit for individuals aged 50 and over remains $1,000. 

Phase-out ranges: Traditional IRA contributions are tax deductible for people not covered by a workplace retirement plan. If you (or your spouse) are, the deduction begins to phase out based on your tax filing status and income. The income ranges for determining eligibility to make deductible contributions to traditional IRAs have increased for 2025. For single taxpayers covered by a workplace retirement plan, the phase-out range is between $79,000 and $89,000. For married couples filing jointly, if the spouse making the IRA contribution is covered by a workplace retirement plan, the phase-out range is between $126,000 and $146,000. For an IRA contributor who is not covered by a workplace retirement plan and is married to someone who is covered, the phase-out range is between $236,000 and $246,000. 

Required minimum distributions: The age at which individuals must begin taking required minimum distributions remains at 73. This means if you are turned 73 in 2024, you need to start taking distributions by April 1, 2025. If you turn 73 in 2025, you’ll need to take your first distribution by April 1, 2026. 

For more information about 2025 tax changes that could affect your retirement plans, click here. Your unique financial situation will determine which changes affect you, so you should consult a tax advisor to help you decide how to proceed. Connect with our team to discover more about what the IRA changes could mean for your overall financial wellness. We’re here to help. 

* Please consult a tax advisor regarding whether this would benefit you.