Web Extra: Taxes and retirement planning

December 1, 2015 -  By

In addition to other tax-minimizing strategies, don’t forget about your 401(k).

The tax savings associated with maxing out your retirement plan for 2015 is $18,000. For a taxpayer in the 25 percent tax bracket, that equals a tax savings of $4,500.

The catch-up contribution limitation for individuals age 50 and older is $6,000. That translates into another $1,500 of savings for an individual in the 25 percent tax bracket for a total tax savings of $6,000.

If the company does a 401(k) match, it’s especially important that you contribute the maximum amount required to get the full match. Otherwise, you are leaving free money on the table.

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About the Author:

Gordon is a New Jersey-based CPA and owner of Turfbooks, an accounting firm that caters to land care professionals throughout the U.S. Reach him at dan@turfbooks.com.

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