With inflation and interest rates on the rise this year, combined with the erratic state of the stock market, it’s more important than ever to create a solid financial plan that includes saving for retirement. Below are important tax payment deadlines and other dates you need to know to start retirement planning for 2023. You’ll also see a few strategies you can use to wrap up your 2022 taxes (such as opening and funding certain IRAs by April 18 to count for 2022) that may impact your 2022 tax bill.
The information below applies to typical retirement accounts and self-directed retirement plans.
Important Income Tax Payment Deadlines in 2023
The IRS officially begins accepting 2022 tax returns on January 24, 2023, but the last possible dates to file most returns are as follows:
- April 18, 2023
Deadline to file your taxes.
The official deadline for most taxpayers to file federal income tax returns for 2022 (or to file an extension) is Tuesday, April 18, 2023 (due to April 15th falling on a Saturday, and because Emancipation Day holiday is celebrated in Washington D.C. on Monday, April 17th).
- October 16, 2023:
Deadline to file taxes if you got an extension.
The due date for most taxpayers to file taxes if you requested an extension. If you plan to file for an extension, the deadline to do so is April 18th.
Tax payment deadlines for 2023 estimated taxes:
1Q: April 18
2Q: June 15
3Q: September 15
4Q: January 15, 2024
Deadline to Take Required Minimum Distributions from Retirement Plans:
If you turned 72 in 2022 or earlier and own a traditional, SIMPLE or SEP IRA or a solo 401(k), you must take required minimum distributions every year.
- December 29, 2023:
This is the deadline to take your RMDs from these plans for 2023. Normally, you have until December 31st, but this year the 31st falls on a Sunday.
If you turn 72 in 2023 or later, you don’t have to begin taking RMDs until you are 73 thanks to the provisions of the SECURE 2.0 Act of 2022 that was passed the last few days in December. Those who turn 73 in 2023 have until December 31, 2024, to take your first RMD.
Deadlines to Open and Fund Retirement Plans
If you haven’t opened a retirement account yet, there’s no time like the present. The earlier you begin to save, the longer the benefits of compound interest in the account work for you—along with potential returns the account garners over the years until you retire. It is easy to learn how to start retirement planning for 2023, keeping these dates and provisions in mind. Plus, you still have time to open and contribute to some accounts and apply those contributions to 2022 to help lessen your tax burden when applicable.
Traditional and Roth IRAs
Traditional and Roth IRAs are plans designed for individuals to save for retirement. The main difference in these plans is that contributions to a traditional IRA are made with pre-tax dollars (meaning your distributions in retirement are taxed) and contributions to a Roth IRA are post-tax (so distributions when you retire are not taxed).
- April 18, 2023:
Deadline to set up and fund a traditional or Roth IRA and designate contributions to count for 2022.
- Contribution limits:
The 2022 limit is $6,000 a year, with an additional $1,000 catch-up contribution if you’re 50 and older.
For 2023, the IRS raised contribution limits to $6,500, and the catch-up remains $1,000.
Simplified Employee Pension (SEP IRA)
A SEP IRA makes saving for retirement easy for the self-employed or businesses with few employees. The annual contribution limit is higher than other IRAs, which allows significant savings and more capital in the account to invest.
- April 18, 2023:
The deadline to open and contribute to a SEP IRA to count for 2022 taxes unless you file an extension.
- October 16, 2023:
If you filed an extension, this is the last day you can open and contribute to a SEP IRA for 2022.
- Contribution limits:
Annual contributions for SEP IRAs are considerable. In 2022, you can contribute the lesser of (up to) $61,000 or 25 percent of your compensation.
Beginning in 2023, the contribution limit is the lesser of $66,000 or 25 percent of compensation. Thanks to the SECURE 2.0 Act of 2022, you’ll also be able to make both employer and employee contributions on a Roth basis.
Savings Incentive Match Plan for Employees (SIMPLE IRA)
The SIMPLE IRA is a great plan for small business owners or for those who are self-employed. You can make contributions to a SIMPLE IRA as an employee and as an employer.
- October 1, 2023:
This is the deadline to set-up a SIMPLE IRA for 2023. (This plan does not offer an extended period to set up in 2023 and count towards 2022.)
- Contributions:
Employees make contributions of up to $15,500 in 2023 through pre-tax salary deferrals, with an additional $3,500 catch-up contribution for those 50 and older.
Employers can match employees’ contributions (dollar for dollar) up to 3 percent of the employee’s annual compensation, which can help lower your business tax liability. Instead of a match, employers can make non-elective contributions of up to 2 percent of an employee’s compensation, even if the employee does not contribute to their plans themselves.
Additionally, the SECURE 2.0 Act of 2022 makes it possible for employees to make Roth contributions into this account in 2023.
Solo 401(k) Plan
The solo 401(k) plan is perfect for self-employed people or for small business owners with no full-time employees other than themselves and their spouses or partners.
- March 15, 2023:
Deadline for S-Corps, partnerships, and LLCs taxed as partnerships and S-Corps (plus extensions) to establish and contribute to a solo-k for 2022. If you file for an extension, September 15 is the latest you can file taxes.
- April 18, 2023:
Deadline (plus extensions) for sole proprietors, LLCs taxed as sole proprietors, and for C-Corps and LLCs taxed as C-Corps to open and contribute to the plan to count for 2022 taxes. October 15 is the latest you can file taxes if you got an extension.
- Contributions:
You can make contributions to solo 401(k) plans as an employee and as an employer.
Employers have until their corporate filing date (including extensions) to establish and contribute to a solo-k to count for 2022 tax returns.
Before the recent enactment of the SECURE Act 2.0, if you have employees who are eligible to contribute, your plan must be established by 12/31 of the tax reporting year for them to make final salary deferrals for that year. But, beginning in 2023, the law has changed to accommodate employee contributions to plans sponsored by sole proprietors or single-member LLCs up until the date that the employee files their tax return. Since this provision is relatively new, we recommend consulting with your CPA to ensure proper planning to maximize both employee and employer contributions.
Your employee elective salary deferral contribution limit for 2022 is $20,500, with a catch-up contribution of $6,500 if you’re 50 or older). The employer profit-sharing contribution can be up to 25 percent of employee earnings. Total employer/employee contributions cannot exceed $61,000 or $67,500 for those 50 and over.
For 2023, the employee salary deferral increases to $22,500 and the catch-up for those 50 and older rises to $7,500. The employer contribution remains at up to 25 percent of employee earnings. The total of employee plus employer contributions cannot exceed $66,000 or $73,500 for those 50 and over.
Health Savings Account (HSA)
A health savings account is not a retirement plan, but they are incredible tax-sheltered savings plans designed to help you pay for qualified medical expenses. To participate in an HSA, you must have a high-deductible health plan (HDHP) and have no other health insurance in place.
- April 18, 2023:
You have until April 18, 2023, (plus extensions) to make an HSA contribution count for 2022 and you have until April 15, 2024, to make contributions that count towards your 2023 income tax return.
Note: You must establish your HDHP by December 1 to make HSA contributions for the following year.
So, to make HSA contributions in 2023, your account should have been set up by December 1, 2022. If you missed that deadline, be sure to open one by December 1, 2023, to contribute in 2024.
- Contributions:
For 2022, individuals can contribute $3,650 and families can contribute $7,300.
In 2023, individuals can contribute $3,850 and families can contribute $7,750.
Education Savings Account (ESA)
Education savings accounts aren’t retirement plans, either, but it is an excellent tax-sheltered account that allows you to save for your child’s education.
- April 18, 2023:
This is the deadline to contribute to an ESA to count for 2022.
- Contributions:
Contributions to ESAs are the same for 2022 as they are for 2023. You may contribute no more than $2,000 into the account.
Retirement Planning Tip: Take Control of Your Retirement Funds
Understanding important tax payment deadlines is one piece of your whole financial and retirement planning picture. If you want to retire and live the lifestyle you desire, it’s crucial to learn how to start retirement planning for 2023 and to continue your planning in the years to come. Self-directed IRAs and other savings plans have the potential to significantly impact your ability to acquire retirement wealth.
When you self-direct, you choose your own assets, and you can invest in a myriad of investment opportunities that you personally know and understand. Things like real estate, private equity, private lending, precious metals are examples of just a few of the many alternative investments that are not dramatically dictated by the ups and downs of the stock market.
To learn more about the different types of self-directed retirement and savings plans, contact Advanta IRA today. Please contact your tax or financial advisor for more information about tax payment deadlines specific to your retirement and savings plans.
Additional resources on retirement planning:
Choose Your Retirement Plan Investments with a Self-Directed IRA
Why Consider a Self-Directed Health Savings Account?
7 Ways the SECURE Act 2.0 of 2022 Enriches Your Retirement Planning
The Basics of IRA Tax Benefits
