Coolidge Wall Co., L.P.A.
Phone : 937-608-9464 | Toll Free : 877-422-0702

IRS Announces 2016 Pension Plan Limitations

On October 21 the IRS announced cost-of-living adjustments for 2016 retirement plan contributions. For 2016, the amounts that individuals will be able to contribute to retirement plans will remain unchanged at $18,000. The catch-up contribution limit for employees age 50 and over will also remain unchanged at $6,000. This chart summarizes the limitations for 2016:

Contribution Limits

2016

2015

Elective Deferral Limit - 401(k), 403(b) and 457(b) Plans

$18,000

$18,000

Catch-Up Contribution Limit

$6,000

$6,000

Elective Deferral Limit - SIMPLE Retirement Plan

$12,500

$12,500

Catch-Up Contribution Limit - SIMPLE Retirement Plan

$3,000

$3,000

Contribution Limit - IRA

$5,500

$5,500

Catch-Up Contribution Limit - IRA

$1,000

$1,000

Benefits and Compensation

Defined Contribution Plan Annual Addition Limit

$53,000

$53,000

Defined Benefit Plan Annual Benefit Limit

$210,000

$210,000

Annual Compensation Limit

$265,000

$265,000

Highly Compensated Employee Limit

$120,000

$120,000

Key Employee Compensation Limit

$170,000

$170,000

The Social Security Administration earlier announced that the Social Security Wage Base for 2016 will remain the same at $118,500.

If you have questions about the new pension plan limitations, please contact Brent Gambill (937-449-5539) or Edie Crump (937-449-5530).

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