2016 Tax Fast Facts For Investors

Mar 10, 2016 • Written by Paul Staib | Certified Financial Planner (CFP®), MBA, RICP®

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2016 Tax Facts

It’s not hard to find tax information on the Internet – when quarterly taxes are due, 401(k) contribution limits, and so 2016 Tax Factsforth.  But in the interest of saving you time and a few clicks, we’ve gathered all of 2016’s important tax facts and dates in a single spot.

IRA Accounts

  • IRA contribution limits (Roth or traditional):
    • $5,500 under age 50
    • $6,500 for age 50 and above
  • Income limits for deductible IRA contribution:
    • Single filers or married couples filing jointly who aren’t covered by a retirement plan at work: None; fully deductible contribution
    • Single filers covered by a retirement plan at work: Modified adjusted gross income:
      • < $61,000 – fully deductible contribution;
      • between $61,000 and $71,000 – partially deductible contribution;
      • > more than $71,000 – contribution not deductible
    • Married couples filing jointly who are covered by a retirement plan at work: Modified adjusted gross income:
      • < $98,000 – fully deductible contribution;
      • between $98,000 and $118,000 – partially deductible contribution;
      • > $118,000 – contribution not deductible.
  • Income limits for nondeductible IRA contributions: None
  • Income limits for IRA conversions: None
  • Income limits for Roth IRA contribution, single filers: Modified adjusted gross income:
    • < $117,000 – full Roth contribution;
    • between $117,000 and $132,000 – partial Roth contribution;
    • > $132,000 – no Roth contribution
  • Income limits for Roth IRA contribution, married couples filing jointly: Modified adjusted gross income :
    • < $184,000 – full Roth contribution;
    • between $184,000 and $194,000 – partial Roth contribution;
    • > $194,000 – no Roth contribution

401(k) Accounts

  • Contribution limits for 401(k), 403(b), 457 plan, or self-employed 401(k) (traditional or Roth):
  • $18,000 under age 50
  • $24,000 for age 50 and above
  • Income limits for 401(k), 403(b), 457 plans: None
  • SEP IRA contribution limit: The lesser of 25% of compensation or $53,000

Saver’s Tax Credit

  • Saver’s Tax Credit, income limit, single taxpayers: $30,750
  • Saver’s Tax Credit, income limit, married couples filing jointly: $61,500

Health Savings Accounts (HSAs)

  • Health-savings account contribution limit:
  • Single contributor under age 55: $3,350
  • Single contributor age 55 and above: $4,350
  • Family coverage, contributor under age 55: $6,750
  • Family coverage, contributor age 55 and above: $7,750
  • High-deductible health plan out-of-pocket maximum
  • Single coverage: $6,550
  • Family coverage: $13,100

College Related Savings Accounts (529s, Coverdell ESAs)

  • Section 529 college-savings account contribution limit: Per IRS guidelines, contributions cannot exceed amount necessary to provide education for beneficiary. Deduction amounts vary by state, and gift tax may apply to very high contribution amounts.
  • Section 529 college-savings account income limit: None.
  • Coverdell Education Savings Account contribution limit: $2,000 per year per beneficiary.
  • Coverdell Education Savings Account income limit,
    • Single filers: Modified adjusted gross income
      • < $95,000 – full contribution;
      • between $95,000 and $110,000 – partial contribution;
      • > $110,000 – no contribution
    • Married couples filing jointly: Modified adjusted gross income
      • < $190,000 – full contribution;
      • between $190,000 and $220,000 – partial contribution;
      • > $220,000 – no contribution

 2016: Important Tax Dates to Remember

  • Jan 1, 2016: New IRA, retirement-plan, and HSA contribution and income limits go into effect for 2016 tax year, as listed above
  • Jan. 15, 2016: Estimated tax payments due for fourth quarter of 2015.
  • April 18, 2016: 
    • Individual tax returns (or extension request forms) due for 2015 tax year.
    • Estimated tax payments due for first quarter of 2016.
    • Last day to contribute to IRA for 2015 tax year (contribution limits: $5,500 under age 55; $6,500 for age 55 and above).
    • Last day to contribute to health-savings account for 2015 tax year (2015 contribution limits: $3,350 for single coverage, contributor under age 55; $4,350 for single coverage, contributor age 55 and above; $6,650 for family coverage, contributor under age 55; $7,650 for family coverage, contributor age 55 and above).
  • June 15, 2016: Estimated tax payments due for second quarter of 2016.
  • Sept. 15, 2016: Estimated tax payments due for third quarter of 2016.
  • Oct. 17, 2016: Individual tax returns due for taxpayers who received a six-month extension.
  • Dec. 31, 2016:
    • Retirees age 70 1/2 and above must take required minimum distributions from traditional IRAs and 401(k)s. 
    • Last date to make contributions to company retirement plans (401(k), 403(b), 457) for 2016 tax year. 

Paul Staib | Certified Financial Planner (CFP®), MBA, RICP®

Paul Staib, Certified Financial Planner (CFP®), RICP®, is an independent Flat Fee-Only financial planner. Staib Financial Planning, LLC provides comprehensive financial planning, retirement planning, and investment management services to help clients in all financial situations achieve their personal financial goals. Staib Financial Planning, LLC serves clients as a fiduciary and never earns a commission of any kind. Our offices are located in the south Denver metro area, enabling us to conveniently serve clients in Highlands Ranch, Littleton, Lone Tree, Aurora, Parker, Denver Tech Center, Centennial, Castle Pines and surrounding communities. We also offer our services virtually.

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