Everything has changed in 2020 but much remains the same. We still give thanks for family and the friendships we have. And as the year comes towards an end, there are time-sensitive financial decisions and tasks to consider.
Medicare Enrollment Deadlines
The Fall Medicare Open Enrollment lets you make changes to your Medicare coverage. This includes enrolling in Medicare Advantage, switching Medicare Advantage plans, returning to Original Medicare from Medicare Advantage. The main Medicare Open Enrollment Period for both Medicare Advantage and Medicare Part D prescription drug coverage happens annually from October 15 to December 7.
Year End Retirement Planning
Contribute to 401k plans by December 31
Deposits to your 401k plan are due by the end of the year. Typically, 401k contributions are made through payroll deduction. It may take your company a pay period or two to process a change and make the deposit.
Take coronavirus expense withdraws by the end of the year.
Retirement savers can withdraw up to $100,000 from a 401(k) or IRA to pay for coronavirus expenses until Dec. 31, 2020, without having to pay the usual 10% early withdrawal penalty.
Donate your IRA distribution to charity
IRA owners who are age 70 1/2 or older can avoid paying income tax on part or all of their required distribution if they directly transfer an IRA withdrawal to a qualifying charity.
Qualify for the Savers Credit
Low- and moderate-income workers who save for retirement in a 401(k) plan or individual retirement account could qualify for the saver’s credit. This retirement savings contributions credit can be claimed when filing taxes.
More time for IRA contributions
You have until April 15, 2021, to make an IRA contribution that will qualify you for a tax deduction on your 2020 return. You can contribute to an IRA shortly before filing your taxes to get a nearly immediate reduction in your tax bill.