Like many people, you may be working on finalizing your 2017 tax return before the April 17 tax-filing deadline. If so, there might be an opportunity for you to obtain a valuable tax deduction and boost your retirement savings at the same time.\r\n\r\nMany people don't realize it, but the deadline for making tax-deductible contributions to some qualified retirement plans actually stretches beyond the end of the calendar year. You have until the 2017 tax-filing deadline - i.e., April 17, 2018 - to make IRA and 401k contributions that count toward tax year 2017.\r\nMax Out IRA Contributions Now\r\nIf you haven't yet maxed out your traditional IRA contributions for 2017, now presents a great opportunity to do so while also possibly reducing your upcoming tax bill if you qualify to deduct these contributions.\r\n\r\nThe annual IRA contribution limit for 2017 is $5,500 if you're under age 50 ($6,500 if you're 50 years of age or over). So, if you haven't yet contributed the maximum amounts for tax year 2017, you can still make a contribution any time before April 17 in order to reach the annual limit. You may even be able to open a brand-new traditional IRA if you don't have one currently and possibly reap tax benefits for tax year 2017. (Note that contributions to Roth IRAs aren't deductible, so this strategy doesn't apply to them.)\r\n\r\nFor example, suppose you're 55 years old and have contributed $4,000 so far to your traditional IRA for tax year 2017. You could make an additional contribution of $2,500 before this April 17 and possibly deduct this amount on your 2017 tax return.\r\n\r\nSo how do you know if your traditional IRA contributions are tax deductible or not? It depends on whether your employer offers an employer-sponsored retirement plan, such as a 401k. If not, the entire amount of your IRA contribution could potentially be tax deductible.\r\n\r\nIf your employer does offer a retirement plan, the deductibility of your IRA contributions will depend on how much money you earn. Once your adjusted gross income (AGI) reaches $62,000 if you're single, or $99,000 if you're married and file jointly, the amount of your IRA deduction will start to phase out. Once your AGI reaches $72,000 if you're single, or $119,000 if you're married and file jointly, you can no longer deduct your IRA contributions. (Note these numbers are for tax year 2017.)\r\nDitto Your 401k Contributions\r\nThe same principle applies to 401k plans. If you haven't yet maxed out your 401k contributions for 2017, you could allocate contributions made between now and April 17, 2018, to tax year 2017. In order to do so, instruct your payroll department to apply these contributions to 2017. Keep in mind that contributions must be made with funds withheld from wages in order to be tax deductible.\r\n\r\nThe elective deferral limit for 2017 is $18,000 if you're under age 50, or $24,000 if you're 50 years of age or over. This means if you're 55 years old and have contributed $20,000 so far to your 401k for tax year 2017, you could make an additional elective deferral of $4,000 before this April 17 and deduct this amount on your 2017 tax return if you allocate the contribution to tax year 2017.\r\nGet a Jump Start on 2018 Contributions\r\nIf you have maxed out your traditional IRA or 401k contributions for 2017, congratulations! You're taking maximum advantage of one of the best tools available not only to save for retirement, but also to possibly lower your current tax bill.\r\n\r\nIn this scenario, you will want to allocate contributions you make between now and April 17, 2018, to the current tax year. This will give you a jump start on maxing out your retirement contributions again in 2018, when the annual contribution limits for IRAs have not changed from 2017. The good news is the government has increased the limits for 401ks by $500, the maximum contributions amount in 2018 are up to $18,500 from $18,000 in 2017.\r\n\r\nThe 2017 tax-filing deadline is approaching quickly so you'll need to act fast in order to implement these strategies. Be sure to speak with a tax professional for detailed guidance in your specific situation.\r\n\r\nTo learn more about IRAs, 401ks and more tax-related information, download Personal Capital's free tax guide.\r\n\r\nDownload guide\r\n\r\nThis blog is for informational purposes only and is intended to offer guidance; not specific legal or tax advice. Clients are advised to consult their personal estate attorney and CPA before taking action based on this advice.