Retirement Account Changes Coming in 2023

December 2022

2023 is right around the corner and there are some changes coming that you need to know if you plan on maximizing your retirement savings.

The Internal Revenue Service announced cost-of-living adjustments (COLAs) affecting dollar limitations for IRAs, Roth IRAs, and other retirement accounts for the 2023 tax year.

The limit on annual contributions to an IRA or Roth IRA has increased to $6,500, up from $6,000. For those age 50 or over, the catch-up limit remains at $1,000.

The amount savers are able to contribute to their employer- sponsored retirement accounts has increased to $22,500 for 2023 and for those age 50 or over, the contribution limit is $30,000 including the catch-up contribution limit. The contribution limit increase pertains to those who participate in 403(b), most 457 plans, the federal government’s Thrift Savings Plan, as well as 401(k)’s.

5 Things That The Happiest Retirees Invest Their Time In

“We can either spend our time and wonder where it went, or invest our time in ways that will make all the difference for ourselves and our people.”

“The Happiest Retirees Invest Their Time In These 5 Things,” details that while money is important & health is critical, how you spend your time can impact your happiness. Click here to find out more about those 5 timely investments.

Did You Know?

There are 51 Million Retirees In the U.S

Looking at the chart below provided by Apollo, you can see that since the beginning of the COVID-19 pandemic, there was a jump in the number of retirees; however, that number is now back to pre-pandemic trends.

Roughly 2.4 million additional Americans retired in the first 18 months of the pandemic.
4.2 million people left the labor force between March 2020 and July 2021

Source: Federal Reserve Bank of St. Louis

Planning Tip: For Those Who Recently Inherited A Retirement Account

If you inherited a retirement account in 2020 or 2021, the IRS has revised its publication to clarify and correct its position on the 10-year rule on Required Minimum Distributions (RMD) on inherited IRAs and will soon publish final regulations. While the final regulations are being worked out, with those regulations applying “no earlier than the 2023 distribution calendar year”, the IRS is waiving penalties for some heirs who needed to start taking RMD right away. The new guidelines will not apply to regular RMDs, eligible designation beneficiaries or heirs who inherited retirement accounts before 2020.

For more details on this recent update, click here to read more.

At SFS, we are closely monitoring the final regulations and will be reaching out to our clients if you are affected. In the meantime, if you have any questions, please call the office at (518) 584-2555.

This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor.

Saratoga Springs Victorian Streetwalk

The Victorian Streetwalk is a downtown Saratoga Springs tradition. Taking place for a few hours each day, starting TODAY Thursday 12/1 through Sunday 12/4, you will be able to find live music, dancing, crafts and snacks throughout the 4 days of holiday fun!

Broadway will be closed tonight 12/1 from 6-9pm for the Tree Lighting Ceremony. For more information and a detailed schedule, click here!