Leaves are changing, it’s getting cooler, and the fall season is on the horizon. As we say goodbye to summer and hello to the final months of 2021, many investors have already started planning how much they will be able to contribute for 2022.
With solid projections being released for 2022, it’s safe to expect that we can see inflation in next year’s limits. Although the IRS will not publish the official numbers until October or November, calculations have been made based on the published inflation numbers that will predict contribution limits and income limits will go up in 2022. Some limits will stay the same.
Traditional and Roth IRAs
The contribution limits for these two personal plan are forecasted to remain the same. These limits will stay at $6,000 in 2022, the same as in 2021. Additionally, the age 50 catch-up limit remains, as it is always fixed by law at $1,000.
Employer Plans
Employer plans, like SEP IRAs and SIMPLE IRAs, have a change predicted. For SEP IRAs, contribution limits will increase to $61,000 per year for 2022, up from $58,000 per year in 2021. The SIMPLE IRA contribution limits will increase to $14,000 in 2022 from $13,500 in 2021. If you are age 50 or over, the catch-up contribution limit will stay the same at $3,000 in 2022.
Health Savings Accounts
The Health Savings Account, or HSA, contribution limits are expected to increase. For single coverage, it will go up by $50 from $3,600 in 2021 to $3,650 in 2022. For HSA accounts with family coverage, you can expect to see the limit go up from $7,200 in 2021 to $7,300 in 2022. These were already announced previously. Those who are 55 or older will still be able to contribute an additional $1,000.
Coverdell Education Savings Account
The Coverdell ESA will also be one of the self-directed accounts that will remain the same. Just as in 2021, the maximum contribution limit for Coverdell accounts will be $2,000 per child per year.
Getting ahead and familiarizing yourself with the 2022 contributions limits will help you prepare and budget for the new year. It’s never too early to start planning, and if you ever have questions about how to make a contribution to your Self-Directed IRA at Quest, call us at 855-FUN-IRAs or schedule a free consultation with an IRA Specialist HERE.