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2022 Contribution Limits and Important Deadlines

Financial Planning Retirement Funding

As we begin the New Year, we wanted to share some helpful reminders and important deadlines to consider for your financial situation in 2022.

2022 Retirement Plan Limits

·         Maximum elective deferral to a 401(k), i401(k), 403(b), 401(a), and 547 plans is $20,500 with a $6,500 catch-up contribution for those aged 50 and older.

·         Maximum contribution to a SIMPLE plan is $14,000 with a $3,000 catch-up contribution for those aged 50 and older.

·         Deadline for self-employed plans employer contribution is your tax filing deadline.

2022 IRA and Roth IRA Limits and Income Thresholds

·         Maximum contribution is $6,000 with a $1,000 catch-up contribution for those aged 50 and older.

·         IRA deduction is phased out between modified adjusted gross income (MAGI) of $68,000 and $78,000 for single filers, and MAGI between $109,000 and $129,000 for those married filing jointly.

·         Roth contributions are phased out between MAGI of $129,000 and $144,000 for single filers and $204,000 and $214,000 for those married filing jointly.

·         Roth conversions and Backdoor Roth contributions must be completed by December 31.

o   For now, Backdoor Roth contributions are still allowed. The Build Back Better legislation being discussed in Congress includes banning Backdoor Roth contributions.

·         Required Minimum Distributions (RMDs) begin at age 72. If this will be your first year of taking RMDs, please give us a call to discuss your options for your unique situation.

o   If this is not your first year of RMDs, we will process your distribution in November unless have made other arrangements for your withdrawal.

2022 Gifting Limits and Strategies

·         Annual gift tax exclusion is $16,000.

·         Estate and gift tax basic exclusion and generation skipping exemption is $12,060,000.

·         Gifting strategies include gifting highly appreciated stock, Qualified Charitable distributions from your IRA, contributions to college 529 plans and cash gifts.

o   If you would like to discuss a gifting plan for your unique situation, please give us a call.

2022 Friendly Reminders

·         If you turn 65 this year, it is time to enroll in Medicare.

·         Health Savings Account (HSA) contribution limits are $3,650 for single individuals and $7,300 for families.

·         While there was much discussion about changes to income tax brackets and capital gains tax, no changes were made in 2021. However, if you are anticipating a significant increase or decrease in your income in 2022, we can discuss tax planning opportunities for your new situation.

·         Free Covid tests are now available! If you would like to receive 4 Covid tests for your household, please visit https://www.covidtests.gov/ to order your tests. Only one order is allowed per address.

If you or someone you know has questions or concerns about any of the items reference above, please do not hesitate to reach out to the team at SGK Wealth Advisors.

Disclaimer

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by STEIGERWALD, GORDON & KOCH WEALTH ADVISORS (“SGK”), or any non-investment related content, made reference to directly or indirectly in this newsletter will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this newsletter serves as the receipt of, or as a substitute for, personalized investment advice from SGK. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. SGK is neither a law firm, nor a certified public accounting firm, and no portion of the newsletter content should be construed as legal or accounting advice. A copy of SGK’s current written disclosure Brochure discussing our advisory services and fees is available upon request or at https://sgkwealthadvisors.com/. Please Note: If you are an SGK client, please remember to contact SGK, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. SGK shall continue to rely on the accuracy of information that you have provided. Please Note: IF you are an SGK client, Please advise us if you have not been receiving account statements (at least quarterly) from the account custodian.