If you're fast approaching retirement age and becoming concerned about the
amount of retirement funds you have set aside, the 2001 Tax Relief Act
held some good news for you. If you are over age 50, you are allowed to make "catch-up" contributions to
your defined contribution retirement accounts.
Like normal IRA or 401(k) contributions, these
catch-up amounts are tax deferred until they are removed from the
retirement plan, at which point they will be fully taxed as income from
Catch-up amounts are tax deferred
Applicable employer-sponsored plans include Section
401(a) employees' trusts, Section 401(k), Section 403(b) annuity plans,
SEP plans, SIMPLE and Section 457 plans.
The additional catch-up deferral amounts are as
|401(k), 403(b), SARSEP and
As of now, the catch-up amounts listed above for
2016 will apply to all years thereafter as well. These catch-up deferrals cannot be nondeductible
If you have questions on these additional deferral
amounts or your own qualification to take them, please do not hesitate to
give us a call.