Is time running out on contributions to retirement and education savings accounts?
Yes and no. Although you have until April 17, 2006, to make your 2005 IRA and Coverdell Education Savings Account contributions, your 2005 contributions to your 401(k) and 529 plan need to be made by Friday, Dec. 30, 2005. Education: There are two tax-advantaged ways to save for education — a 529 plan (contribution deadline: Dec. 30, 2005) and an Education Savings Account (contribution deadline: April 17, 2005). The 529 plans are designed to help families save for future college costs — earnings and withdrawals are tax-free so long as you use them for qualified education expenses. Although 529 plans do not have specific contribution limits, you can contribute up to $11,000 in 2005 free of gift tax. If you invest in your home state’s 529 plan, you may be eligible for tax breaks. However, although you may receive tax benefits by investing in your own state’s plan, you can invest in any state’s 529 plan, so be sure to evaluate your options carefully. Depending on your income, you may al
