Tax Tip: IRA Contributions Can Be Made Until April 16

If you haven't put any money into an Individual Retirement Arrangement (IRA) for tax year 2000, or if you've put in less than the maximum allowed, you still have time, according to the IRS. You can contribute to either a traditional or Roth IRA until the April due date of your tax return.

If you make a contribution for the previous tax year, tell the IRA trustee which year the contribution is for. Otherwise, the trustee may report the contribution as being for the year in which it was received.

You may contribute up to $2,000 of your earnings each year to an IRA. You may fund a traditional IRA, a Roth IRA (if you qualify), or both, but your total contributions cannot be more than $2,000 in one year.

You may be able to take a tax deduction for the amounts you put into a traditional IRA, depending on whether you (or your spouse, if filing jointly) are covered by an employer's pension plan and how much total income you have. You cannot deduct Roth IRA contributions, but the earnings on a Roth IRA may be tax-free if you meet the conditions for a qualified distribution.

You may file your tax return before you make the IRA contribution, but you must be sure to complete the contribution by the filing deadline, not including extensions. Typically, this means that the contribution must be made by April 16, 2001. If you report a contribution to a traditional IRA on your return, but fail to make the contribution by the deadline, you must file an amended tax return. If you claimed a deduction for an IRA contribution that you failed to make, you must add that amount back to your income on the amended return and pay tax accordingly.

IRS Publication 590 has detailed information on Individual Retirement Arrangements. This publication is available at local IRS offices or by phone at I-800-TAX-FORM (1-800-829-3676).

View more tax tips!


This daily Tax Tip has been provided by the IRS

You may like these other stories...

Being an accountant doesn't mean you're giving investment advice to clients. However, at tax time, accountants often have to deal with the results of any investment advice clients obtained during the year—the...
Anti Burger Kings: Seven US companies shrinking tax the old-fashioned wayBurger King’s decision to combine with Canadian donut shop Tim Hortons is renewing controversy over the lengths some US companies will go to...
A new report released on Tuesday found that the US airline industry receives nearly $1 billion in tax breaks annually from states for jet fuel.The study, conducted by UNITE HERE International Union, a labor union that...

Already a member? log in here.

Upcoming CPE Webinars

Aug 28
Excel spreadsheets are often akin to the American Wild West, where users can input anything they want into any worksheet cell. Excel's Data Validation feature allows you to restrict user inputs to selected choices, but there are many nuances to the feature that often trip users up.
Sep 9
In this session we'll discuss the types of technologies and their uses in a small accounting firm office.
Sep 11
This webcast will include discussions of commonly-applicable Clarified Auditing Standards for audits of non-public, non-governmental entities.
Sep 26
In this jam-packed presentation Excel expert David Ringstrom, CPA will give you a crash-course in creating spreadsheet-based dashboards. A dashboard condenses large amounts of data into a compact space, yet enables the end user to easily drill down into details when warranted.