Tax Tips for Seniors and Retirees

Tax Tips for Seniors and Retirees

Higher Standard Deduction

If you're 65 or older, you get an extra standard deduction:

• $1,600 extra (single or head of household)
• $1,300 extra per spouse (married)

Required Minimum Distributions (RMDs)

• Start at age 73 for traditional IRA/401(k)
• Calculate based on prior year-end balance and life expectancy factor (IRS Uniform Lifetime Table)
• Miss an RMD: 25% penalty (reduced to 10% if corrected promptly)
• Take by December 31 each year (first RMD can be delayed to April 1 of the following year)

Qualified Charitable Distributions (QCDs)

If 70½ or older with an IRA:

• Donate up to $108,000/year directly from IRA to charity
• Excluded from income (better than a deduction)
• Counts toward your RMD
• Reduces combined income, potentially reducing SS taxes

Managing Social Security Taxes

• Keep combined income below thresholds to minimize SS taxation
• Withdraw from Roth accounts strategically

Medicare IRMAA

High-income retirees pay surcharges on Medicare Part B and Part D premiums:

• Triggered by MAGI 2 years prior
• Roth conversions today can affect Medicare costs in retirement

Credit for Elderly or Disabled

For taxpayers 65+ or permanently disabled with limited income — a non-refundable credit.

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Approaching or in retirement? Let us create a tax-efficient withdrawal plan.