New Retirement Plan Contribution Limits for 2018
posted Nov 14, 2017 by Peri Ann Aptaker, Esq., CPA/PFS, CFP®, CBA in the Global Tax Blog
The Internal Revenue Service has issued the annual cost of living adjustments for 401(k) contributions, pension plans, and other retirement related matters. There are a few changes to modified adjusted gross income limits that you’ll want to note.
Individual Retirement Plan Limits 2018
|IRA Contribution Limit||$5,500||$5,500||$5,500|
|IRA Catch-Up Contributions||$1,000||$1,000||$1,000|
*The catch-up contribution limit for employees ages 50 and over who contribute to 401(k), 403(b), most 457 plans and the federal government’s Thrift Savings Plan remains unchanged at $6,000.
Phaseout ranges for 2018:
|Traditional IRA MAGI Limits||2018||2017||2016|
|Married filing jointly; a spouse who participates in an employer-sponsored plan||$101,000-$121,000||$99,000-$119,000||$98,000-$118,000|
|Married filing jointly; a spouse who does not participate in an employer sponsored plan||$189,000-$199,000||$186,000 - 196,000||$184,000-$194,000|
|Single or Head of Household||$63,000-$73,000||$62,000 - 72,000||$61,000-$71,000|
For Roth IRAs, if your MAGI falls within the applicable range, you can make a partial contribution, but if it exceeds the top of the range, you are not allowed to make a contribution.
|Roth IRA MAGI Limits||2018||2017||2016|
|Married filing jointly||$189,000-$199,000||$186,000-$196,000||$184,000-$194,000|
|Single or Head of Household||$120,000-$135,000||$118,000-$133,000||$117,000-$132,000|
The contribution limit for workers who are enrolled in 401(k), 403(b), most 457(b), and the federal government’s Thrift Savings Plan has changed from $18,000 to $18,500.
As you’ll notice, the contribution limits and catch-up contributions remain the same for the New Year, as they have since 2013. The annual IRA limit is adjusted based on inflation every year, typically increasing in $500 increments, but the amount has remained stagnant since 2013. Instead, only income limits have increased for 2018.
Contact our Tax Team for more information.