GAC is a community where every member of the family has a place and a responsibility. Through structured giving opportunities, we work together to provide the highest quality academic and extracurricular selections, parent programs, and mission opportunities near and far.

Our commitment to Be Greater is a promise and an investment. Our mission is to help each child grow as Jesus did, in wisdom and stature, and in favor with God and man. Given the right tools, space, and faithful guidance, our students grow into capable people who understand the value of generous support.

We invite every family to join us in helping our students grow to be greater in every way.

Text Resize
Subsribe to RSS Feed

Friday June 21, 2024

Washington News

Washington Hotline

Opportunity Until April 18 to Fund Your IRA

Individuals with earned income may fund an IRA up to the 2022 limits on or before April 18, 2023. The 2022 funding amount may be the lesser of earned income or $6,000 ($7,000 if the individual is over age 50). The regular IRA contribution amount increased to $6,500 in 2023.

A traditional IRA may be funded this year, but if you are covered by a company plan there are phase-out limits. A single person who is an active participant in a company retirement plan may contribute to the IRA if his or her income is less than $68,000. The ability to contribute is phased out between $68,000 and $78,000 for single individuals or heads of household. A married individual has a phaseout limit from $109,000 to $129,000. However, if the married individual is not an active participant but has a spouse who is an active participant in a qualified plan, the phaseout is from $204,000 to $214,000.

Roth IRAs may also be funded for the 2022 tax year with after-tax cash until April 18. An individual also needs earned income to transfer $6,000 (or $7,000 if you are over 50) into a Roth IRA. The Roth IRA has additional benefits during 2023. Roth contributions may be withdrawn at any time without penalty. If you have taxable income, you may add to your Roth after reaching age 73. Unlike the traditional IRA, a Roth IRA does not have required minimum distributions (RMDs) after age 73. This "no RMD" rule will also be expanded to include Roth 401(k) accounts in 2024.

The Roth contribution is also limited for high-income individuals, regardless of participation in a company retirement plan. The Roth IRA phaseout for a single person is from $129,000 of AGI to $144,000 of adjusted gross income (AGI). The married limit is from $204,000 to $214,000, provided you are filing jointly.

An IRA must be managed by an approved trustee or custodian. Many banks, savings and loans or credit unions are qualified to be IRA custodians. Most financial services firms, including insurance companies, also serve as IRA custodians.

If you contributed nondeductible amounts to a traditional IRA, you will need to track your basis. Your basis is generally your total nondeductible IRA contributions and any additional basis from plans you have rolled over into your IRA. If you make a nondeductible IRA contribution, you must file IRS Form 8606. This will help you track your IRA basis. IRS Publication 590-B is a worksheet that will help you calculate the amount of taxable and nontaxable distribution from this IRA.

Published February 17, 2023
Subsribe to RSS Feed

Previous Articles

New IRS Voluntary Tip Reporting Program

IRS 2022 Tax Return Checklist

IRS Reminder To Report Digital Asset Income

Free File Launched on January 13

2023 Tax Filing Season Opens on January 23



Dr. David Fincher

Katherine White
Vice President of Advancement

we are a community

"The strength we experience in GAC today is because people planned their legacies to build a bright and faithful future. In their estates and wills, large and small, they made a place for GAC and Christian education. You can see their handiwork in scholarships they endowed; in facilities and programs that wouldn't be here without their gift in a will; with support for teachers; in faithchanging experiences for students every year."

Dr. David Fincher
GAC Chancellor