How Retirement Benefits Will Change in 2015
Social Security, Medicare and retirement accounts will all have new rules next year.
Social Security and Medicare will be making important changes to their programs next year.
Individual retirement accounts and 401(k)s will also be tweaked in significant ways.
Here's a look at the new features of your retirement benefits will have next year.
Social Security
Social Security recipients will receive 1.7
percent bigger payments in
2015, due to the annual cost-of-living
adjustment.
Most workers will continue to pay 6.2 percent of their earnings
into the Social Security system, but the maximum taxable
earnings amount will increase next year from
$117,000 in 2014 to $118,500 in
2015.
The Social
Security administration will also mail Social Security
statements to workers
turning ages 25, 30, 35, 40, 45, 50, 55 and 60 in 2015 who haven't created an
online account.
Medicare
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The standard Medicare Part
B premium will
remain $104.90 monthly in 2015, although high-income beneficiaries pay
more, and the deductible is unchanged at $147 a year.
The Medicare Part A hospital inpatient
deductible will increase from $1,216 in 2014
to $1,260 in 2015.
Medicare Part D premiums vary by plan and are expected to increase
by 4 percent to an average $38.83 in 2015, assuming retirees stick with their
current plan, according to an analysis of Part D plans by researchers at
Georgetown University, the University of Chicago and the Kaiser Family
Foundation.
The maximum possible Part D deductible will be $320 in 2015, but
some plans may charge smaller deductibles or no deductible.
The open enrollment period has now closed.
401(k)
The 401(k) contribution limit will increase by
$500 to $18,000 in 2015.
The catch-up contribution limit for workers age
50 and older will also grow by $500 to $6,000 in
2015.
IRA
The IRA contribution limit will remain $5,500
in 2015, and savers age 50 and older can contribute an additional $1,000
as a catch-up contribution.
Workers who have a retirement account at work can claim a tax
deduction for making a traditional IRA contribution until their modified
adjusted gross income is between $61,000 and $71,000 for individuals and $98,000
to $118,000 for couples in 2015, up $1,000 and $2,000, respectively, from
2014.
Spouses
without a workplace retirement plan who are married to someone with a 401(k) can
claim the IRA contribution tax deduction until their income is between
$183,000 and $193,000 in 2015.
The Roth IRA income limits will also increase
by $2,000 in 2015 to between $116,000 and $131,000 for individuals and $183,000
to $193,000 for married couples.
However, investors who earn more than these limits may be able to
convert traditional IRA assets to a Roth IRA.
Saver's credit
Workers who save in a 401(k) or IRA may be eligible for the
saver's credit if their AGI is less than $30,500 for singles, $45,750 for heads
of household and $61,000 for married couples in 2015.
These limits are between $500 and $1,000 higher
than in 2014.
This valuable tax credit is worth 50 percent, 20 percent or 10
percent of your 401(k) or IRA contributions up to $2,000 ($4,000 for couples),
with the biggest credit going to savers with the lowest incomes.
The maximum possible saver's credit is worth $1,000 for individuals
and $2,000 for couples.
New retirement
account
The Treasury is expected to offer a new type of retirement
account, the myRA.
https://myra.treasury.gov/
https://myra.treasury.gov/
These Roth accounts with be funded with
after-tax dollars via payroll deduction, but they are
not tied to your job and are guaranteed by the government to never lose value.
The myRA will be available to workers with an
annual income of less than $129,000 for individuals and $191,000 for couples,
and they can use the account for up to 30 years or until their account balance
hits $15,000, after which the balance will transfer to a private-sector
retirement account.
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