How To Make 2025 IRA Contributions Count For 2024 Taxes?

Many taxpayers do not know that they can make IRA contributions in 2025 that will apply for the 2024 tax year. In general, these contributions must be made before the original filing deadline, April 15, 2025. If you file a Form 4868 extension request for your Form 1040, this does NOT extend the deadline to make the IRA contributions.

If you make a Traditional IRA contribution before April 15, 2025, you can instruct your broker to apply the contribution to the 2024 tax year. This way, you can make that Traditional IRA contribution count on your 2024 taxes.

The examples in this video cover a scenario where a single filing taxpayer who is covered by a retirement plan at work wants to make a retroactive traditional IRA contribution for the 2024 tax year.

The taxpayer discovers she owes roughly $2,000 with her tax return after completing the first draft. She calculates that if she contributes a specified amount to her Traditional IRA, she can receive a full deduction for the contribution. By making the Traditional IRA contribution apply to 2024, she saves over $1,000 in taxes.

Sources:
IRS Reminder for IRAs: https://www.irs.gov/retirement-plans/ira-year-end-reminders
Traditional IRA Deduction Limits: https://www.irs.gov/retirement-plans/plan-participant-employee/2024-ira-contribution-and-deduction-limits-effect-of-modified-agi-on-deductible-contributions-if-you-are-covered-by-a-retirement-plan-at-work
IRA Contribution Limits: https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-ira-contribution-limits

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