FORT IRWIN, Calif. — The end of the tax season is rapidly approaching, and the Tax Center wants to provide some last-minute information about how to reduce your taxable income.
Taxable income is your gross income after you subtract all of the deductions that the IRS allows. One of these deductions is a contribution to a traditional Individual Retirement Account (IRA). Most taxpayers can contribute up to $5,500 dollars per year ($6,500 if you are 50 or older) and subtract that contribution from taxable income. If you are married and file a joint return, each spouse can contribute to his/her individual IRA if at least one of the spouses has earned income. This means a married couple can deduct a maximum of $11,000 per year from taxable income. IRA contributions can be made until the last day of tax season.
Sgt. 1st Class Snuffy and his wife, Sarah, are having their 2018 joint return prepared. They are both 35 years old. Sgt. 1st Class Snuffy has a taxable income of $50,000. Sarah had no taxable income for 2018. Sgt. 1st Class Snuffy and Sarah may both contribute $5,500 to their IRAs. As long as they make this contribution before April 15, 2019, they can deduct $11,000 from their taxable income.
For the IRS explanation of the credit, visit: https://www.irs.gov/retirement-plans/individual-retirement-arrangements-iras.
For more information, please contact the Fort Irwin Tax Center at (760) 380-1040. The Tax Center is located at Bldg. 230 on the corner of C Avenue and Third Street, and it is open Monday through Friday 9 a.m.-5 p.m. Tax season ends on April 15, and the Tax center strongly encourages the Fort Irwin community to take advantage of the services offered by the Tax Center.