Your birthday this year could mark an important tax and financial planning milestone. Following are opportunities and considerations as we move into 2022.

Age 50 » Catch-up contributions of up to $6,500 can be made to your employer-sponsored retirement plan, such as a 401(k), or up to $1,000 to a Traditional or Roth IRA. You can make the full catch-up contribution if you reach age 50 at any point in 2022.

Age 55 » You can make a catch-up contribution of up to $1,000 to your Health Savings Account (HSA).

Age 55 » You can access an employer retirement plan account without a 10% early distribution penalty upon separation of service from that employer. To qualify for the penalty exception, the money must stay in the employer plan and can’t be rolled over to an Individual Retirement Account (IRA).

Age 59.5 » You now have access to employer retirement plan accounts or IRA accounts without a 10% penalty. Some employer plan rules may still disallow an in-service distribution if you are still employed.

Age 62 » Social Security benefits can be collected at the earliest possible date, but at a 30% reduction as compared to your full retirement age (FRA) benefit amount.

Age 65 » Enrollment for Medicare benefits begins. Enrolling late can incur a permanent enrollment penalty.

Age 66–67 » You can access your full retirement age Social Security benefits.

Age 70 » You can collect your maximum Social Security benefit. The benefit increases by 8% for each year that you wait past your full retirement age. Waiting past age 70 does not provide any additional benefit.

Age 70.5 » Charitable contributions of up to $100,000 each year can be made directly from your IRA account as a Qualified Charitable Distribution (QCD).

Age 72 » Required minimum distributions (RMDs) from your employer retirement plan and IRA accounts commence. An RMD will be required each year.

If you have any questions about what we’ve shared above or you’d like more information about how your tax situation might change this year, please contact us.

NOTE: The information provided in this article is intended for clients of Carlson Capital Management. We recommend that individuals consult with a professional adviser familiar with their particular situation for advice concerning specific investment, accounting, tax, and legal matters before taking any action.