Tax Breaks You Should Know About If You’re 50 or Older

Innovating Protection for Tomorrow

Turning 50 isn’t just a milestone — it’s a money moment. This stage of life comes with higher earning potential and (finally!) some meaningful tax advantages. If you’re in your 50s or beyond, you still have time to build serious wealth — and the IRS gives you a few ways to do just that.

Here’s what you should know about the top tax breaks and catch-up contributions available after 50.

The closer you are to retirement, the more power you have to shape it. Use every tool available — including the ones designed just for your age.

Mrs. Verra Aza

Catch-Up Contributions for 401(k) Plans

In 2025, the standard 401(k) contribution limit is $23,500 — but if you’re 50 or older, you can contribute an additional $7,500, bringing your total to $31,000. That’s a powerful way to boost your retirement savings before you exit the workforce.

Even if you’re a little behind, this tax-advantaged space gives you time to catch up.

2. Extra Room in Your IRA Contributions

Have a Traditional or Roth IRA? Great news. The standard contribution limit is $7,000, but if you’re over 50, you get to invest an extra $1,000 each year — up to $8,000 total in 2025.

And depending on your income, you might qualify for deductions (Traditional IRA) or tax-free withdrawals later (Roth IRA).

3. HSA Boost for Health Savings

Healthcare costs rise with age — and thankfully, so can your Health Savings Account (HSA) contributions.

In 2025:

Individuals can contribute $4,300
Families can contribute $8,550
If you’re 55 or older, you can add an extra $1,000 on top

HSA funds grow tax-deferred, are deductible when you contribute, and tax-free when used for medical expenses. Triple win!

4. Penalty-Free Withdrawals at 59½ (and Rule of 55)

Normally, pulling money from your 401(k) before age 59½ results in a 10% penalty. But once you cross that age, you can withdraw without penalties.

Also, if you leave your job at age 55 or older, you may be able to take early withdrawals from your 401(k) without penalty — thanks to the IRS Rule of 55. Just be aware that taxes may still apply.

How Veracity LD Can Help

Turning 50 is not the end of your wealth journey — it’s a new beginning. At Veracity LD, we help you take full advantage of your financial position, with strategies for retirement planning, tax-efficient investing, and more.

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