Trying to fund an individual retirement account ahead of the Tax Day deadline? Here's what you need to know

• Tuesday's federal tax filing deadline also means it's the last call for contributions to individual retirement accounts for 2022.
• Here's what to consider if you're looking to fund an IRA in the last-minute rush.

Gereon Moreno holds a sign indicating that there is one day left to file taxes as he stands in front of a Liberty Tax Service office in Miami, Florida, on April 17, 2023.

Joe Raedle | Getty Images

As the clock ticks to get your federal income taxes filed by the Tuesday, April 18, deadline, there may be one more move you want to make: funding an individual retirement account.

The deadline to make IRA contributions generally coincides with Tax Day.

Some residents of eight states have federal tax deadline postponements until May, July or October due to natural disasters, according to the IRS. That includes California, Alabama, Georgia, Arkansas, Mississippi, Indiana, Tennessee and New York.

Filers in those areas can wait until their respective extended deadlines to pay what they owe the IRS, and add 2022 contributions to their IRAs and health savings accounts by those dates. To find out if this applies to you, the IRS provides more information here.

However, others who file extensions still face an April 18 deadline to fund their IRAs for 2022, noted Ed Slott, an IRA expert and certified public accountant. Filers may also add funds to their health savings account, if they are eligible for one, to count toward 2022.

Notably, those contributions are "the last thing you can do to affect last year's return," Slott said.

In 2022, individuals can put up to $6,000 into IRAs, or $7,000 if they are over age 50. Those limits apply to both traditional and Roth IRAs.

For 2023, those limits are higher — $6,500, or $7,500 for those over 50.

How to make a last-minute IRA contribution for 2022

If you're rushing to make last-minute contributions, you should make sure the transaction is dated properly, Slott said. It is possible to make an IRA contribution for either tax years 2022 or 2023 at this time.

For example, some investors may inadvertently indicate 2023 because the transaction is taking place this year, even though they want it to count for tax year 2022, Slott said.

Moreover, you may run into difficulty if you initiate an IRA contribution but it does not settle until after the deadline, noted Rita Assaf, vice president of retirement at Fidelity.

It's generally really easy to open an IRA in a few minutes, even on Tax Day, and add money, Assaf said. But that transaction may take longer to clear, particularly if you are moving funds from an outside financial services firm or bank.

"By waiting until the last day, you run the risk of it potentially not making it towards the deadline," Assaf said.

Nevertheless, tax season is usually a key deadline that prompts people to think about the broader picture when it comes to their retirement planning, Assaf said.

Traditional versus Roth IRAs: Which to pick?

Because a traditional IRA consists of pretax funds, a contribution may enable you to take a tax deduction.

However, your ability to take that deduction may vary if your income exceeds certain thresholds or if you or your spouse have access to a work retirement plan.

Roth IRA contributions, on the other hand, consist of post-tax contributions. How much you can contribute may also be limited based on your income and filing status.

You may be able to get around these restrictions through a Roth conversion, where traditional IRA funds are moved to a Roth IRA. Of note, this will trigger a tax bill on the funds you converted. But it frees up that money to be accessed tax-free later on.

While funding a Roth IRA may not immediately affect your tax circumstances now, experts say it may be the better pick in the long run.

"You're better off, if you qualify, to do a Roth," Slott said.

One key reason for that is the money in a Roth grows free of taxes, Slott said. The original contributions can be withdrawn any time for any reason, at any age tax- and penalty-free, he said.

Once you decide between a traditional or Roth IRA, the next decision is how to invest those funds.

"It's a two-step process, fund and then invest," Assaf said. "You don't want to lose out on long-term earnings potential by not investing."

Now is also a good time to make a resolution to get your IRA contributions for 2023 done earlier.

Winnie Sun, a financial advisor and co-founder and managing director of Irvine, California-based Sun Group Wealth Partners, said she encourages clients to fund their IRAs starting in January.

"When clients do that, and they're thinking ahead like that, they just tend to be better investors in general," said Sun, who is also a member of the CNBC Advisor Council.