For Freelancers, New Federal Help in Saving for Retirement

Nontraditional workers can contribute to an I.R.A. on their own and set up automatic transfers to it from their bank account. (They can get the Saver’s Credit, if they qualify.) Workers are more likely to save if retirement contributions are automatic, said David Certner, legislative counsel with AARP.

Even if workers start by contributing just a few hundred dollars when they can, “it’s just good to get started,” said Spencer Betts, a certified financial planner in Lexington, Mass.

Some Secure 2.0 Act changes that can help nontraditional workers do begin this year. SEP I.R.A.s, short for Simplified Employee Pension Plan, which are often used by self-employed people because contribution limits are higher, can allow workers to make Roth contributions, Ms. Brenner said. But I.R.A. providers will need time to prepare their programs to offer the Roth option, she said, so savers may need to be patient. (Solo 401(k)s, another retirement savings option for self-employed people, already allow Roth contributions.)

Also, states are increasingly offering I.R.A. programs for traditional workers who are ineligible for retirement plans through their employers, and some, like Oregon’s, are open to self-employed people.

Here are some questions and answers about saving for retirement as a gig worker:

How much can I contribute to a traditional or Roth I.R.A.?

For the tax year 2022, you can contribute up to $6,000 ($7,000 if you are 50 or older). For 2023, those limits rise by $500 each, to $6,500 and $7,500. (But you generally don’t qualify to contribute to a Roth, or for a tax deduction for a contribution to a traditional I.R.A., if you make over certain income limits.) The I.R.S. has details.

Who can claim the Saver’s Credit?

The little-known credit lets individual taxpayers get back some of their retirement contributions as a reduction in their tax bill. Your eligibility and the size of your credit vary depending on your income, your filing status and the amount of your retirement contribution. The credit is worth a maximum of $1,000 for single filers and $2,000 for joint filers. For the 2022 tax year, single filers with income of $34,000 or less are eligible ($36,500 for 2023). Married couples filing a joint tax return with income of $68,000 or less qualify in 2022 ($73,000 in 2023).

Can I use a health savings account to save for retirement?

Yes. Many self-employed people have high-deductible health plans that can be paired with tax-favored health savings accounts, or H.S.A.s. Funds contributed can be used for current medical costs, or saved and invested longer term. Funds contributed are tax deductible and grow tax-free. The money is free from federal tax, and from state tax in some states, when withdrawn to pay for medical expenses. After age 65, there’s no penalty for spending the money on non-health items, but the funds are taxed as income.