I am sure that everyone is thinking about their plans for the holiday tomorrow and what way they will celebrate our independence. Let’s not forget about all the troops that have made sacrifices for that independence. Which brings me to this weeks post regarding how the government is saying thanks to our troops. On May 29th our president signed into law the “Heroes Earned Retirement Opportunities Act” which allows combat pay that is typically excluded to be treated as compensation for IRA contribution rules. This will allow our troops to save more for their retirement and those earnings can grow tax free.
The change retroactively applies to taxable years beginning after December 31st 2003. Members of our armed forces have three years after the enactment to make a contribution for prior qualified years. Additionally any other credits or refunds that were not allowed because of a contribution are now allowed under the Act if a claim is filed before the close of the one-year period beginning on the date the contribution is actually made.
If you are in the armed services, be sure to check with your accountant regarding this change and your tax status.
Until next week…..Enjoy your Fourth of July
Keeping Your Business N Synergy
Brian N. Stovall