A self-directed IRA (SDIRA) has the potential to greatly benefit your retirement goals – but being proactive is key to easy management. With the new year approaching, there’s no time like the present to get your investment portfolio and retirement savings on track. STRATA’s 2024 IRA Calendar conveniently segments IRA obligations, deadlines, and other administrative tasks to be completed throughout the year. While some months may require you to take action, other months allow you to manage administrative and planning tasks to make sure your account information is up to date and you’re achieving your savings and investment targets.
Download STRATA’s 2024 IRA Calendar
Watch for important documents from your IRA custodian in January. Review them to make certain they are accurate; they will affect your tax liability for 2023 or future years. By January 31, you should receive the following information:
- RMD Notice – If you were age 73 or older in 2023, your IRA custodian will inform you of the requirement to take a minimum distribution (RMD) in 2024. (Before 2023, the beginning age for RMDs was 72. The SECURE 2.0 Act of 2022 increased the RMD age to 73 for IRA owners who did not reach age 72 by December 31, 2022.)
- IRS Form 1099-R – If you withdrew money or investments from your IRA in 2023, your IRA custodian will send you a copy of IRS Form 1099-R to report the value of the distribution and any federal or state tax withheld and remitted. This form is also filed with the IRS to report taxable income you received in 2023 and any tax withholding remitted on your behalf. Form 1099-R does not reflect certain activities that could reduce your tax liability for a distribution, such as completing a rollover or taking a distribution that includes nondeductible contributions (basis). You must notify the IRS on your tax return that you qualify for reduced tax liability as a result of any of these situations.
- Q4 STRATA IRA statements are released – accountholders will be notified when available. Your IRA custodian reports the year-end fair market value of your IRA in your statement. Learn how to access your statements and other import documents with our step-by-step guide.
An FMV must be provided to your IRA custodian each year. If an FMV as of December 31, 2023, is needed, STRATA will send a timeline communication and a reminder request. Depending on the type of investments in your IRA, your investment sponsor may send the updates or you may need to arrange to have your investments valued by a qualified appraiser. For more information and to overview the FMV process refer to STRATA’s articles What are the Annual Requirements for Alternative Assets FMVs? or for those that hold directly owned real estate refer to What are the Annual Requirements for Directly Owned Real Estate FMVs?
March 31 is the due date for investment sponsors to provide their FMV updates for STRATA IRA account holders who hold alternative investments.
Contribute the maximum amount to your IRA for 2023. You still have time to contribute and take a deduction on your tax return for 2023. You can contribute up to $6,500 (or 100% of your income if less) to your Traditional and Roth IRAs ($7,500 if you’re age 50 or older) until April 15, 2024, as a contribution for 2023. Be sure to include instructions with your deposit if you want your IRA custodian to apply the contribution for 2023, or it will be applied to the current year (2024 contribution).
Take your 2023 RMD by April 1 if you turned 73 in 2023 and waited until 2024 to take your first RMD.
File your 2023 individual income tax return by April 15, 2024. The federal income tax return deadline is April 17, for residents of Main and Massachusetts. All individual filers may apply for an extension to file by October 15 (Form 4868). Be sure to include Form 8606, Nondeductible IRAs, with your tax return to track nontaxable assets in your IRAs.
April 30 is the deadline for all accountholders to submit their annual FMVs, in order for STRATA to meet the IRS Form 5498 filing deadline.
Q1 STRATA IRA statements are released – accountholders will be notified when available.
Watch for your copy of IRS Form 5498, IRA Contribution Information, from your IRA custodian by May 31. This form reports all contributions made to your IRA for 2023, including annual contributions, rollovers, conversions, and recharacterizations. Form 5498 must also include the fair market value of your entire IRA and separately report the value of certain hard-to-value investments in your IRA. This information is filed with the IRS, so it’s important to provide accurate valuations to your IRA custodian and make sure your tax return contains information that matches Form 5498.
Conduct a mid-year review of your IRA investments this summer while there are no tax or IRS requirements to perform. Halfway into 2024 – are your investments performing as you expected? Do you need to adjust your objectives or leverage idle cash? A self-directed IRA provides the freedom to invest your IRA in a wide array of alternative investments, such as real estate and private equities, that offer diversification from more traditional investments tied to the stock market; you may want to visit with your financial advisor this summer to explore a wider range of investment alternatives.
Q2 STRATA IRA statements are released – accountholders will be notified when available.
Revisit your beneficiary designation for your IRAs. Have you married, divorced, and/or had a child this year? Have you opened a new IRA or transferred assets between IRAs? Any of these types of actions may trigger a need to change your IRA beneficiaries. If not, at least confirm that your beneficiaries’ addresses, telephone numbers, and email information are correct, so that legal rights to your IRA assets will be transferred smoothly to the beneficiary of your choice upon your death—outside of probate.
If you filed your 2023 taxes by the April deadline, October 15 is the deadline to correct an excess contribution for 2023 and to recharacterize a 2023 contribution from a Traditional IRA to a Roth IRA or vice versa.
Schedule your 2024 RMD so it is processed by December 31. (If you are turning 73 in 2024, you may wait until April 1, 2025, to take your 2024 RMD.) The amount you are required to take will be based on your December 31, 2023, IRA balance and the IRS’s life expectancy tables. If your IRA investments must be liquidated to payout the RMD, consider whether you want to take an in-kind distribution of your investment instead, or if you can satisfy your RMD from another IRA with more liquid assets.
Q3 STRATA IRA statements are released – accountholders will be notified when available.
If your taxable income for the year is less than you anticipated or well below the next tax bracket, you may want to consider converting some of your Traditional, SEP, or SIMPLE IRA assets to a Roth IRA. This is a taxable transaction, so it could increase your tax liability for 2024. But Roth IRAs are not subject to the RMD requirements while you’re alive, and all Roth IRA distributions can be tax-free. If you’re interested in creating a tax-free income stream in retirement or for your heirs, talk to your financial or tax advisor about the benefits and considerations of converting pre-tax retirement assets to an after-tax Roth IRA.
Take your RMD, if you are 73 or older, before December 31. If you are a beneficiary of an IRA, you may need to elect a payment option or take a payment from an inherited IRA by December 31. If an IRA owner or beneficiary fails to take a required payment for 2024, they are subject to a 25% excise tax (reduced to 10% if payment is taken within a 2-year correction window) on the portion of the amount that should have been distributed but remained in the IRA.
December 31 is also the deadline to complete a conversion to a Roth IRA if you want the additional income counted for the 2024 tax year.
For More Information
If you have any questions about your IRA or the IRS requirements for IRAs, contact our self-directed IRA experts. Additionally, our Knowledge Center is filled with informative articles covering all aspects of IRAs.
