The IRS has recently issued new limits on qualifying pensions and retirement related accounts (see IRS Notice 2018-83.) The new amounts, which are a cost-of-living adjustment, become effective January 1, 2019.
Qualified Plan Limits
| 401(k) Elective deferrals | $19,000 |
| Catch-up contribution limit | $6,000 (unchanged from 2017) |
| Defined Contribution Plan Annual Contribution | $56,000 |
| Annual compensation limit | $280,000 |
| Defined benefit plan annual benefit limit | $225,000 |
| Taxable wage base |
$132,900 |
Highly Compensated Employees
| Any employee with more than 5% ownership or lineal ascendant or descendant of 5% owner (current or preceding year) | $125,000 (unchanged from 2017) |
Key Employees
| Any office | $180,000 |
| 5% owner | No minimum amount |
457(e)15
| 457(e) 15 | $19,000 |
Simple Plans
| Annual Deferral | $13,000 |
| SIMPLE Catch-up | $3,000 (unchanged from 2017) |
SEP
| Minimum compensation | $600 |
| Annual compensation | $280,000 |
If you have any questions about these new limits and how they may affect you, please contact your Zinner tax professional.