What Important Dates Does a Retiree Need to Circle?

Dates
The start of a new year—and a new decade, to boot—is a great time to assess your financial situation and look ahead. You’ll want to consider moves for the long term, but it’s also critical to pay attention to the details in the short-term, so you don’t miss an important deadline.

What Important Dates Does a Retiree Need to Circle?

Kiplinger’s recent article entitled “A Retiree’s Guide to Key Dates in 2020” explains that the calendar below has the significant dates of importance to pre-retirees and retirees. It will give you a head start on getting organized.

January 1:

Now that we are officially into a new tax year, and as you find your documents to prepare for filing your 2019 tax return, look for ways to lessen your 2020 tax tab.

If you’re still working, you can deposit more into your 401(k)s for 2020. You can put up to $19,500 into your employer plan—$500 more than 2019. If you’re 50 or older anytime in the calendar year, your maximum contribution jumps to $26,000. You can also put funds in a traditional or Roth IRA, or a combination of both. The maximum total IRA contribution for 2020 is $6,000, plus an extra $1,000 if you’re 50 or older. Once you turn 70½, you can no longer contribute to a traditional IRA. However, you can contribute to a Roth IRA, if you’re still working. If you’ve retired but your spouse is still working, the working spouse can make the maximum contribution to a spousal IRA for you, provided the worker’s earnings cover the contribution and his or her own IRA contribution.

The first is also the start date for Medicare’s general enrollment period. It goes until March 31, and coverage begins July 1. If you miss enrolling for Medicare at age 65 and don’t qualify for a “special enrollment period” (for people who had group coverage beyond age 65), you can enroll in Parts A and B during this period. In the same time frame, Medicare Advantage beneficiaries can move to a different Advantage plan or to traditional Medicare.

January 15:

This is the deadline for the fourth quarter estimated tax payment for 2019 taxes. You can forgo this deadline, if you file your 2019 taxes by January 31 and pay the remaining balance at that point.

March 31:

This is the deadline for traditional Medicare general enrollment and Medicare Advantage open enrollment.

April 1:

If you turned 70½ in 2019, April 1 is the deadline for taking your first required minimum distribution (RMD) from your tax-deferred retirement accounts. All subsequent RMDs must be taken by December 31. To figure out a first RMD due by April 1, 2020, take the 2018 year-end account balance and divide it by a life expectancy factor based on your birthday in 2019. You can find the factor in IRS Publication 590-B. you’ll still need to take your second RMD this year, if you waited on the first RMD.

If you’re still working past 70½, you can skip the RMD from your current employer’s 401(k) if you don’t own 5% or more of the company. However, you must take RMDs from traditional IRAs and 401(k)s from previous employers.

April 15:

The federal tax filing deadline for 2019 returns is on the regular date in 2020.

You can make 2019 IRA contributions up until April 15, which is up to $7,000, if you are 50 and older.

This is the deadline for the first estimated tax payment for 2020.

June 15:

This is the deadline for the second quarter estimated tax payment for 2020.

July 1:

Here’s when you can gauge a midyear estimate of your 2020 tax bill. Be sure withholding or estimated tax payments are on track to avoid underpayment penalties. You can avoid those penalties by paying at least 90% of the current year tax tab or 100% of the prior year tax tab (110% if you have a high income).

Look for tax-saving moves to trim your 2020 tab.

September 15:

This is the deadline for the third quarter estimated tax payment for 2020. If you are off track with estimated tax payments, or just don’t want to bother, you can withhold tax from your RMD. Withholding is to be evenly paid over the year, even if you withhold tax on an RMD taken in December and it can help cover the tax on all your income for the year.

September 30:

Your “annual notice of change” from your Medicare Advantage or Part D prescription-drug plan should be delivered to your mailbox by today.

October 15:

If you filed for an extension on April 15 for your 2019 tax return, today is the deadline to turn it in.

Medicare open enrollment begins. From now until December 7, you can switch between traditional Medicare and Medicare Advantage, or choose new Advantage and Part D plans, with coverage effective 2021.

November 1:

Early retirees in most states can purchase 2021 health coverage offered on exchanges under the Affordable Care Act from now until December 15.

December 7:

This is the deadline for Medicare’s open enrollment.

December 15:

This is the deadline for the ACA’s open enrollment.

December 31:

This is the deadline for your RMD to be out of your account.

While you are at it, consider maxing out contributions to your employer retirement account, harvesting portfolio losses, making a Roth conversion, making charitable gifts and using up your annual gift exclusion of $15,000 for 2020 to give gifts to as many people as you choose.

Reference: Kiplinger (Dec. 24, 2019) “A Retiree’s Guide to Key Dates in 2020”

For more information read:

12 Important Retirement Planning Deadlines

Countdown to Retirement: 1 Year Away

And read one of our Previous Blogs: 

How Do I Include Retirement Accounts in Estate Planning?

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