Household Employees
Are you a household
employer? You might be if you hired a housekeeper or a care
provider for your dependent and the person provided services
in your home. If you have a household employee, you may be
required to withhold Social Security and Medicare taxes,
federal unemployment tax, and federal income tax.
Individual Retirement Arrangement (IRA) -
Contributions
You can contribute up to $5,500
to your IRA (or $5,500 to your spouse's IRA if married
filing jointly). If you or your spouse is age 50 or older,
there is an additional "catch-up" contribution of up to
$1,000 allowed.
Individual Retirement Arrangement (IRA) - Early
Withdrawal
There is no additional 10% tax on
early withdrawals up to $10,000 in your lifetime from an IRA
if you are buying a first home for yourself, your children,
or your grandchildren, or if you are paying higher education
expenses for the IRA owner, spouse, child, or grandchild.
Individual Retirement Arrangement (IRA) - Rollover
The IRS may waive the 60-day requirement for
rollovers from pensions or IRAs if you suffer a casualty,
disaster, or other event beyond your reasonable control that
prevents meeting the 60-day rule.
Retirement Savings Contributions Credit
There is a credit for a percentage (50%, 20%, or 10%) of
up to $2,000 of contributions you make to an employer
elective deferral plan or IRAs. You must be age 18 or older
to claim the credit. In addition, you cannot be a student as
defined in the dependency tests or claimed as a dependent on
another's return. Any distribution from a retirement plan
any time in the preceding two tax years, in the current tax
year, or any day up until the due date of the current year's
return will reduce the amount available for the credit. This
credit is in addition to any deduction or exclusion for the
contribution.
Roth IRA
You can elect to contribute up
to $5,500 to a Roth IRA. If you are age 50 or older, there
is an additional "catch-up" contribution allowable of
$1,000. The Roth IRA differs from the traditional IRA
because contributions are not deductible, but when withdrawn
the earnings are not taxable.
Roth 401(k)
If you are eligible to
participate in a 401(k) or 403(b) plan through your employer
you may designate a portion of your elective deferral to be
treated as a Roth contribution. These contributions will be
treated as regular income on Form W-2. Distributions from
these accounts will be tax-free under the same provisions as
a Roth IRA.
Itemized Deductions - Limits
Your
income may limit the total amount of itemized deductions you
can take. In 2013, if your adjusted gross income is over
$156,400 ($78,200 if Married Filing Separately), your total
itemized deductions may be reduced.
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