BHRC | FROM PAGE 25 Beacon Hill Roll Call tracks the length of time that the House and Senate were in session each week. Many legislators say that legislative sessions are only one aspect of the Legislature’s job and that a lot of important work is done outside of the House and Senate chambers. They note that their jobs also involve committee work, research, constituent work and other matters that are important to their districts. Critics say that the Legislature does not meet regularly or long enough to debate and vote in public view on the thousands of pieces of legislation that have been fi led. They note that the infrequency and brief length of sessions are misguided and lead to irresponsible latenight sessions and a mad rush to act on dozens of bills in the days immediately preceding the end of an annual session. During the week of November 18-22, the House met for a total of one hour and nine minutes and the Senate met for a total of one hour and fi ve minutes. MonNov. 18 House11:04 a.m. to 11:26a.m. Senate 11:08 a.m. to 11:59a.m. Tues.Nov. 19 No House session No Senate session Wed. Nov. 20 No House session No Senate session Thurs. Nov. 21 House11:00 a.m. to 11:46a.m. Senate 11:06 a.m. to 11:20a.m. Fri. Nov. 22 House11:00 a.m. to 11:01a.m. THE MALDEN ADVOCATE–Wednesday, November 27, 2024 No Senate session Page 27 Bob Katzen welcomes feedback at bob@beaconhillrollcall.com TRADITIONAL IRA CONTRIBUTIONS Bob founded Beacon Hill Roll Call in 1975 and was inducted into the New England Newspaper and Press Association (NENPA) Hall of Fame in 2019. Lawn and Yard CareUSA FALL LAWN It’s Time For CLEAN-UPS - CALL NOW! • Reasonable rates • Fast, reliable service 781-521-9927 Discount Tree Service 781-269-0914 SPADAFORA AUTO PARTS JUNK CARS WANTED SAME DAY PICK UP 781-324-1929 Advocate Call now! 617-387-2200 advertise on the web at www.advocatenews.net Quality Used Tires Mounted & Installed Used Auto Parts & Batteries Family owned & operated since 1946 Professional TREE REMOVAL & Cleanups 24-HOUR SERVICE T here are limits that the Internal Revenue Code places on the amount of contributions that may be made to a traditional IRA. Deductible contributions may be limited when the individual (or his spouse) is an active participant in a retirement plan maintained by an employer. The application of the contribution and deduction limits are diff erent for taxpayers fi ling joint returns than for other taxpayers. An individual is not considered an active participant in an employer-sponsored plan merely because his or her spouse is treated as an active participant. However, the maximum deductible IRA contribution for an individual who is not an active participant, but whose spouse is an active participant, is phased out for adjusted gross income levels between $230,000 and $240,000 for calendar year 2024. As an example, Clyde is a participant of his company 401(k) plan. Clyde and Bonnie fi le a joint income tax return for calendar year 2024 reporting an adjusted gross income of $220,000. Bonnie may make a deductible contribution to a traditional IRA for calendar year 2024 because she is not an active participant in an employer-sponsored retirement plan and their combined adjusted gross income is below $230,000. However, Clyde may not make a deductible IRA contribution because the couple’s combined adjusted gross income is above the present range for active participants who are married fi ling a joint return ($123,000 to $143,000 for 2024). Assume the same facts as in the above example except that Clyde and Bonnie’s adjusted gross income was $240,000 for calendar year 2024. Neither Clyde or Bonnie would then be able to make a deductible contribution to a traditional IRA. The limit of $143,000 for Clyde was exceeded and the limit of $240,000 for Bonnie was exceeded. The maximum contribution to a traditional IRA is $7,000 for calendar year 2024. It will remain at $7,000 in calendar year 2025. Catch-up contributions will be allowed for any taxpayer who will be at least 50 years of age at the end of the year. These taxpayers will be able to make an additional contribution of up to $1000 for calendar years 2024 and 2025. The maximum allowable deduction is phased out if the taxpayer is an active participant in an employer-sponsored retirement plan. For calendar year 2024, the reduction is an amount that bears the same ratio to the maximum allowable deduction as the taxpayer’s adjusted gross income in excess of the “applicable dollar amount” bears to $10,000. For a single taxpayer, the “applicable dollar amount” is $77,000. The deduction amount becomes $0 when his or her adjusted gross income is $87,000 or more. As an example, assume Fredo’s adjusted gross income is $82,000 for calendar year 2024. $82,000-$77,000 = $5,000. $5,000/$10,000 = 50%. You then need to multiply the maximum traditional IRA contribution amount of $7,000 by 50% in order to determine the non deductible portion of the IRA contribution. Therefore, in this example, $3,500 would represent the non-deductible portion and $3,500 would constitute the deductible portion. This is the formula you would need to utilize in order to determine what deduction to actually take on your federal income tax return. When the IRA is partially or no longer deductible, it is a good time to evaluate whether or not a contribution to a ROTH IRA would make more sense. These are just some of the numerous rules surrounding traditional IRA’s. The choices are now more diffi cult to make as a result of the creation of the ROTH IRA. This IRA grows tax-deferred but does not provide for a current income tax deduction. After age 59 ½, the taxpayer can withdraw monies in a ROTH IRA and pay no taxes on the earnings, so long as the account has been opened for at least fi ve years. Joseph D. Cataldo is an estate planning/elder law attorney, Certifi ed Public Accountant, Certifi ed Financial Planner, AICPA Personal Financial Specialist and holds a master’s degree in taxation. CLASSIFIED ADVERTISING Call $ $ $ $
28 Publizr Home