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).
