Saving more with tax reform

The new tax law is in full effect and there’s more to it than new rates and brackets. Depending on your situation, your paycheck may be a little bigger. If so, you may want to consider adding some of that extra money to your retirement plan.

Here are three ways the new tax reform law could affect you or your retirement planning:

1

Converting to Roth

In the past, if you switched your retirement savings from pretax to Roth, you could undo that change until October 15 of the following year. Under the new law, you will only have until the end of that same year to change your mind.

2

Repaying a loan from your retirement plan

If you have an outstanding loan from your plan and leave your employer, you will not be taxed on the amount of your loan as long as you contribute its balance to an IRA by the due date for your individual tax return.

3

Filing your taxes

With standard deduction increases under the new law, you may choose to claim the standard deduction instead of filing an itemized tax return. Talk to your tax professional if you have questions about how the new tax reform law will impact your particular situation.