The IRS has announced the new retirement plan limits for 2018. Some limits increased from 2017 to 2018, and some stayed flat. Highlights include:
- The compensation limit used to determine benefits and contributions for both defined benefit and defined contribution plans increased from $270,000 to $275,000.
- For defined benefit plans, the maximum annual benefit for a participant with at least ten years of participation and a normal retirement age between 62 and 65 increased from $215,000 to $220,000.
- For defined contribution plans (profit sharing and 401(k) plans), the maximum annual contribution for a participant increased from $54,000 to $55,000. While this limit includes salary deferrals, it does not include catch up contributions.
- The limit on salary deferrals for 401(k) plans increased from $18,000 to $18,500. The limit on catch up contributions for 401(k) plans, which are available to participants who attain age 50 by the end of 2018, remains unchanged at $6,000.You can find a printable version of the complete list of the new 2018 annual limits by visiting the Retirement Plan Limits page of our website.
- As 2018 approaches, so does the deadline to set up a qualified plan for a 2017 calendar tax year. If you are interested in setting up a qualified plan, please contact us.
