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5 Ways You Can Still Boost Your Tax-Advantaged Savings for 2016

You have until April 18 to contribute to an IRA for yourself and your spouse, a Roth IRA for your kid, and a health savings account.

Question: Is it too late for me to contribute to my IRA and health savings account for 2016?

Answer: No, it’s not too late. Even though you had to make 401(k) contributions for 2016 by December 31, you still have until April 18, 2017, to contribute to an IRA, HSA and several other types of tax-advantaged accounts for 2016.

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Contribute to an IRA, even if you earned just a little in 2016. If you earned any income from a job, you can contribute. Even part-timers and people who are partially retired can make IRA contributions. Contributions are limited to the amount you earned from working for the year, with a $5,500 maximum (or $6,500 if 50 or older in 2016). And even if you’re a dedicated saver who has maxed out your 401(k), you can still contribute to an IRA.

You can contribute to a Roth IRA if your adjusted gross income was below $132,000 if single or $194,000 if married filing jointly in 2016 (although the contribution amount starts to phase out if you earned more than $117,000 if single or $184,000 if married filing jointly). You can make traditional IRA contributions only if you’re younger than 70½, but there’s no maximum age to contribute to a Roth. See Retirement Plan Contribution Limits for 2016 for more information. Also see Even Retirees Working Part-Time Can Contribute to a Roth IRA.

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Contribute to a spousal IRA. There is an exception to the earned income rule for IRA contributions: If you didn’t have earned income in 2016 but your spouse did, he or she can contribute up to $5,500 (or $6,500 if you’re 50 or older) to a spousal IRA on your behalf. The total combined amount a couple can contribute to both spouses’ IRAs cannot be more than the total amount of money both of you earned for the year. See Contributing to a Spouse’s IRA for more information.

Contribute to a Roth for your kid. Children of any age who earned income from a job in 2016 can contribute up to $5,500 (or the amount they earned in 2016, if less) to a Roth IRA, too. You can even give them the money to contribute. Not all IRA administrators let minors contribute to IRAs, but several brokerage firms, such as Fidelity, Schwab and TD Ameritrade, offer custodial Roth IRAs with low investment minimums and no IRA administrative fees. Contributing to a Roth IRA can give your kids a huge head start on building tax-free savings for retirement. See Roth IRAs Are for Kids, Too for more information.

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Contribute to a self-employed retirement account. If you had any freelance or consulting income in 2016, you have until April 18 to open and contribute to a Simplified Employee Pension. Your contributions are tax-deductible, and the money grows tax-deferred until retirement. If you already have a solo 401(k) account, you have until April 18 to make your 2016 contribution, but you must have opened the account by December 31. See How Self-Employed Workers Can Save for Retirement for more information.

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Contribute to a health savings account. If you had a high-deductible health insurance policy in 2016 (with a deductible of at least $1,300 for individual coverage or $2,600 for family coverage), you can make tax-deductible contributions to an HSA. You can contribute the full $3,350 for single coverage or $6,750 for family coverage if you had an HSA-eligible health insurance policy for all of 2016. You can also contribute the full amount if you didn’t have the HSA-eligible policy for the full year but did have it on December 1 (in that case, you need to keep an HSA-eligible policy for all of 2017). If you had an HSA-eligible policy only for the first few months of 2016, your contribution limit is based on the number of months you had an eligible policy. See HSA FAQs for more information.

Contribute to a 529 college-savings plan. Most states that offer an income-tax deduction for 529 contributions required you to contribute by December 31 to get a tax break for 2016. But a few states give residents until the tax-filing deadline in April 2017 to make tax-deductible contributions for 2016, including Georgia, Iowa, Mississippi, Oklahoma, Oregon, South Carolina and Wisconsin. For details about each state’s rules and deadlines, see our Find the Best 529 Plan for You tool. Also see SavingforCollege.com.

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