IRS has announced the 2018 cost-of-living adjustments (COLAs) with respect to retirement plan limits. Many limits, which are adjusted by reference to Code Sec. 415(d), are changed for 2018 since the increase in the cost-of-living index met the statutory thresholds that trigger their adjustment. However, others remain unchanged. Certain dollar limit changes keyed to Code Sec. 1(f)(3), some of which were previously calculated by Thomson Reuters Checkpoint editors, have also increased. IR 2017-177; Notice 2017-64, 2017-45 IRB.
Complete list of contribution changes:
- Annual contribution limit - changes to your election can be made any time during the year
- Catch-up limit
SEP IRAs and Solo 401(k)
- Contribution limits for self-employed and small business owners
After-tax 401(k) contributions
- 2018 - $55,000 (overall cap, including the $18,500 (pre-tax or Roth) salary deferrals plus any employer contributions (but not catch-up contributions))
SIMPLE retirement accounts
- 2018 - stays the same at $12,500, as well as the same catch-up limit of $3,000
Defined benefit plans
- 2017 - $215,000
- 2018 - $220,000
Transportation and parking benefits - for transportation in a commuter highway vehicle or any transit pass, as well as qualified parking
- 2017 - $2,600
- 2018 - $2,650
IRS Rev. Proc. 2017-58
IRS Notice 2017-64
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