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Annually, the IRS reviews the limits placed on retirement plans and IRA contributions and the amount of benefits allowed under a pension plan. Figures are evaluated to determine if an adjustment is needed based on cost of living index statutory thresholds. For 2018, several items are unchanged from previous years. However, other items have been increased, including defined contribution limits into certain plans. To help clients and others understand the changes, Selden Fox has provided a summary below.

2017

2018

 IRAs

IRA Contribution Limit $5,500 $5,500
IRA Catch-Up Contributions (50 or over) 1,000 1,000

 IRA AGI Deduction Phase-out Starting at

Joint Return 99,000 101,000
Single or Head of Household 62,000 63,000

 SEP

SEP Minimum Compensation 600 600
SEP Maximum Contribution 54,000 55,000
SEP Maximum Compensation 270,000 275,000

 SIMPLE Plans

SIMPLE Maximum Contributions 12,500 12,500
Catch-Up Contributions (50 or over) 3,000 3,000

 401(k), 403(b), Profit-Sharing Plans, etc.

Annual Compensation 270,000 275,000
Elective Deferrals 18,000 18,500
Catch-up Contributions (50 or over) 6,000 6,000
Defined Contribution Limits 54,000 55,000
ESOP Limits 1,080,000

215,000

1,105,000

220,000

 Other

HCE Threshold 120,000 120,000
Deferred Benefit Limits 215,000 220,000
Key Employee 175,000 175,000
457 Elective Deferrals 18,000 18,500
Control Employee (board member or officer) 105,000 110,000
Control Employee (compensation-based) 215,000 220,000
Taxable Wage Base 127,200 128,400

Contact Us

Maximizing retirement savings is one way to ensure that your future income aligns with your important retirement goals. If you have questions about retirement plan contributions limits or plan audits, Selden Fox can help. For additional information, please call us at 630.954.1400, or click here to contact us.

Daniel DiMario

Dan's practice covers the preparation and review of business, fiduciary and individual tax returns, including returns for family offices and high-net-worth individuals. He regularly communicates with clients on changes in federal, state and local income tax laws and compliance issues, and details how these changes will impact clients’ income tax liability.