Money Girl 5 Money-Saving Tax Changes for 2025
Dec 13, 2024
Get ready for some money-saving insights as tax changes for 2025 are on the horizon! Learn about increased contribution limits for retirement plans, which can help boost your savings. Discover updates to medical savings accounts that may impact your finances. There's also a discussion on adjustments to tax brackets designed to help families manage healthcare and tax expenses. Plus, find out how to maximize your deductions and contributions to keep more money in your pocket!
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Maximize Retirement Contributions
- Maximize contributions to pre-tax traditional retirement accounts to reduce taxable income.
- Consider Roth accounts for potential long-term tax savings, especially if you anticipate a higher tax rate in retirement.
IRA Changes
- IRA contribution limits remain at $7,000 for 2025, with an additional $1,000 catch-up contribution for those over 50.
- Higher income thresholds for deductible traditional IRA contributions and Roth IRA eligibility will apply in 2025.
Medical Savings Accounts
- Utilize Health Savings Accounts (HSAs) and Flexible Savings Accounts (FSAs) to reduce healthcare expenses.
- Consider FSAs for potential tax-free childcare expense coverage if available.