What To Look for in 2005

This is archived information that pertains only to the 2004 Tax Year. If you
are looking for information for the current tax year, go to the Tax Prep Help Area.

IRA deduction expanded. You, and your spouse if filing jointly, may be able to deduct up to $4,000 ($4,500 if age 50 or older at the end of 2005). If you were covered by a retirement plan, you may be able to take an IRA deduction if your 2005 modified AGI is less than $60,000 ($80,000 if married filing jointly or qualifying widow(er)).

EIC phaseout amount increased for joint filers. The maximum amount of earned income that joint filers can have and still take the EIC will be $2,000 more than that for other filers.

Elective salary deferrals. The maximum amount you can defer under all plans is generally limited to $14,000 ($17,000 for section 403(b) plans if you qualify for the 15-year rule). The catch-up contribution limit is increased to $4,000 ($2,000 for SIMPLE plans).

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