Tax Day isn't just the deadline for filing your taxes or requesting an extension. It's also the last day you can contribute to most types of individual retirement accounts (IRAs). Whether you want to save more for retirement or use the contributions to potentially reduce your tax bill, here's what you need to know to fit in one more contribution before the deadline.
Roth IRA and traditional IRA contribution deadlines 2024
If you have a traditional IRA or Roth IRA, you have until the tax deadline, or April 15, 2025, to make contributions for the 2024 tax year. You can contribute up to $7,000 to your IRA if you're under 50 or $8,000 if you're 50 or older for tax year 2024. The exact amount you can sock away or deduct on your tax return may be reduced, depending on your income. Check out our guides to IRA contribution limits and Roth IRA contribution limits to see what your contribution eligibility is.
SEP IRA contribution deadline 2024
If you're a small business owner with a Simplified Employee Pension (SEP) IRA, you have until the due date for your business tax return—including extensions—to make your 2024 SEP IRA contributions of between 0% to 25% of total compensation, adjusted for self-employment taxes and the selected contribution percentage (with a maximum of $69,000). Tax filing deadlines (and therefore SEP IRA contribution deadlines) vary by business structure.
SIMPLE IRA contribution deadline 2024
Because SIMPLE IRAs are essentially IRAs that are eligible for both employer and employee contributions, they have 2 different contribution deadlines. This is an important distinction to be aware of if you're self-employed and contributing as both an employee and employer, as you may have more time to make employer contributions.
The employee 2024 deferral contribution must be made as soon as possible but no later than within 30 days of the end of the month that the employee's pay was deferred. For pay deferred in December 2024, the deadline is as soon as possible but no later than January 30, 2025. Employers have until the due date of their business tax return for tax year 2024—including extensions—to make matching or nonelective contributions.
The maximum SIMPLE IRA employee contribution for 2024 is $16,000, plus an additional $3,500 for those 50 and older.
Tips to help maximize your IRA contributions
Here's how to help make the most of every IRA contribution.
Choose the best account for you
A common choice when considering opening an IRA is whether you'll opt for a traditional IRA or Roth IRA. Which is better for you may boil down to how you prefer to manage your taxes.
Contributions to traditional IRAs could be tax-deductible if your income is below the threshold, and your withdrawals will be taxed as ordinary income.1,2 On the other hand, Roth IRA contributions are made after you've paid taxes on the money. So there's no tax break today, but any potential earnings in a Roth IRA grow tax-free and withdrawals are tax-free once your reach age 59½ and at least 5 years have elapsed since the beginning of the tax year when you made your first contribution.3
You can withdraw from traditional or Roth IRAs penalty-free after you turn 59½, although at least 5 years must elapse between the beginning of the tax year of your first contribution to a Roth account and the time when you withdraw earnings, even if you are 59½ or older. If you need to withdraw from your IRA before 59½, you can learn more about your options on our IRA early withdrawals page.
Not sure which IRA to choose? Check out our guide to traditional vs. Roth accounts.
Contribute to your IRA early and often
How can you build a sizable balance in IRAs to help save for retirement? There are 2 main keys:
- Save regularly. Try to make a habit of saving in your IRA, whether that's monthly contributions, or a lump sum once a year. The more you contribute and invest in your IRA, the better chance you may have at reaching your retirement savings goals.
- Start saving as soon as you can. Saving early in your career is crucial to meeting your retirement goals. If you save early and keep those savings invested over decades, you have the potential to benefit from compound returns.
Keep in mind that contributions to an IRA may be tax-deductible and may qualify for the Saver's Credit. Those tax savings can be applied to your 2024 return for contributions made before the applicable deadline. Looking ahead to 2025, if you automate savings into an IRA, you may want to automate your tax savings, as well. Instead of waiting to file a return, you can accelerate your tax savings by adjusting your Form W-4, if you have one. The IRS has a tool to do this. If you are self-employed, you may want to revisit your estimated tax payments in consideration of any impact to deductions and credits.