401(k)

A retirement investment account which is typically offered by your employer. You may choose to contribute up to a certain amount of your salary to your 401(k) account. The maximum annual amount you may contribute is determined by the IRS each year and is $19,000 in 2019. Your contribution to your 401(k) account will not be subject to Federal income tax until you receive distributions from the account. You may start receiving distributions from the account without a penalty after you turn 65. In the year in which you turn 70½, and each year after that, you will have to take a required minimum distribution from your 401(k).

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BY Chris Durheim