The IRS has announced new limits for retirement plans for the coming year. Are you making the most of this tax benefit? We are happy to help. Contact your HORNE tax advisor to review your plan and contributions to make the most of this tax saving benefit for 2019. Here are a few of the new limits we can discuss:
LIMIT ON |
REGULATION IMPACTED |
OLD LAW |
NEW LAW |
Exclusion for elective deferrals |
§402(g)(1) (e.g., §401(k) and §403(b) |
$18,500 |
$19,000 |
Annual additions to defined contribution plans |
§415(c)(1)(A) |
$55,000 |
$56,000 |
Annual benefit under a defined benefit plan |
§415(b)(1)(A) |
$220,000 |
$225,000 |
Annual compensation |
§401(a)(17), §404(l), §408(k)(3)(C), and §408(k)(6)(D)(ii) |
$275,000 |
$280,000 |
Compensation regarding elective deferrals to SIMPLE retirement accounts |
§408(p)(2)(E) |
$12,500 |
$13,000 |
Elective deferrals to deferred compensation plans of state and local governments and tax-exempt organizations |
§457(e)(15) |
$18,500 |
$19,000 |
Concerning the definition of “key employee” in a top-heavy plan |
§416(i)(1)(A)(i) |
$175,000 |
$180,000 |
Catch-up contributions to §§401(k), 403(b), and 457(b) plans for individuals age 50 or over |
§414(v)(2)(B)(i) |
Unchanged |
Unchanged |
Catch-up contributions to an employer’s SIMPLE plan for individuals age 50 or over |
§414(v)(2)(B)(ii) |
Unchanged |
Unchanged |
The definition of “highly compensated employee” |
§414(q)(1)(B) |
$120,000 |
$125,000 |
Compensation amount regarding simplified employee pensions (SEPs) |
§408(k)(2)(C) |
Unchanged |
Unchanged |
Compensation amount concerning the definition of “control employee” for fringe benefit valuation purposes |
§1.61-21(f)(5)(i) |
Unchanged |
Unchanged |
Compensation amount concerning the definition of “control employee” for fringe benefit valuation purposes |
§1.61-21(f)(5)(iii) |
$220,000 |
$225,000 |
Annual contributions to an Individual Retirement Arrangement |
|
$5,500 |
$6,000 |
Additional IRA catch-up contribution for individuals aged 50 and over |
|
Unchanged |
Unchanged |
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