An IRA allows your money to grow tax-deferred, or – in the case of Roth accounts – tax-free. However, annual contributions are limited by tax law, and any unused limit can’t be carried forward to make larger contributions in future years. So it’s a good idea to use up as much of your annual limits as possible.

While it’s too late to add to your 2015 401(k) contributions, there’s still time to make 2015 IRA contributions. The deadline is April 18, 2016. The limit for total contributions to all IRAs generally is $5,500 ($6,500 if you were age 50 or older on December 31, 2015).

A traditional IRA contribution also might provide some savings on your 2015 tax bill. While Roth IRA’s are not deductible, your traditional IRA contribution is fully tax deductible on your 2015 tax return if you qualify for one of these two things. One, you and your spouse don’t participate in an employer-sponsored plan, such as a 401(k). Two, you and your spouse do participate, but your income doesn’t exceed certain limits.

Evaluate your options. If you don’t qualify for a deductible traditional IRA contribution, see if you qualify to still make a Roth IRA contribution. Even if you exceed the applicable income-based limits, a nondeductible traditional IRA contribution may make sense. Neither of these options will reduce your 2015 tax liability, but they still provide valuable opportunities for tax-deferred or tax-free growth.

Our tax professionals can help you determine which type of contributions you’re eligible for and what makes sense for you. Reach out to them for more information.