Tax Break Vanishing for Some Retirement Savers
A popular tax break in the form of being able to make so-called catch-up contributions to 401(k) retirement savings plans is set to vanish for many higher-earning Americans at the end of this year.
Catch-up contributions refer to a provision in 401(k) plans that allows individuals aged 50 and older to contribute extra money to their retirement savings accounts. The aim of catch-up contributions is to enable older workers to accelerate their retirement savings in the years leading up to their retirement.
This year, eligible workers aged 50 and older can put an extra $7,500 into their 401(k) accounts, for a total of $30,000. But starting next year, changes will limit that eligibility for higher earners….