The Internal Revenue Service recently announced the dollar limitations for pension plans and other items beginning January 1, 2019. Some of the limits are listed below.
LIMITATION
|
2018 AMOUNT |
2019 AMOUNT |
Maximum Annual Compensation taken into account for determining benefits or contributions to a qualified plan
|
$275,000 |
$280,000 |
Basic Elective Deferral Limitation for 401(k), 403(b) and 457(b) Plans1
|
$18,500 |
$19,000 |
Catch-up Contribution Limit for Persons Age 50 and older in 401(k), 403(b) or SARSEP Plans
|
$6,000 |
$6,000 |
Limitation on Annual Additions to a Defined Contribution Plan2
|
$55,000 |
$56,000 |
Limitation on Annual Benefits from a Defined Benefit Plan3
|
$220,000 |
$225,000
|
Highly Compensated Employee Compensation Threshold4
|
$120,000 |
$125,000
|
SEP Compensation Threshold
|
$600 |
$600 |
|
Social Security Taxable Wage Base for Social Security Tax (6.2%) |
$128,700 |
$132,900 |
For Medicare Tax (1.45% / 2.35%)
|
No Limit |
No Limit |
Health Savings Accounts:
• Individual Contribution Limit
• Family Contribution Limit
• Catch-Up Contributions |
$3,450
$6,900
$1,000 |
$3,500
$7,000
$1,000
|
|
Health Flexible Spending Accounts5 |
$2,650 |
$2,6506 |
1 This limit and the catch-up limit also apply to Roth (after-tax) contributions under 401(k) and 403(b) plans that permit such contributions.
2 In no event may annual additions exceed 100% of a participant’s compensation.
3 In no event may a participant’s annual benefit exceed 100% of the participant’s average compensation for the participant’s high three years.
4 Generally, an employee is considered “highly compensated” if the employee:
(a) was a five-percent owner of the employer at any time during the current or preceding year; or
(b) received compensation from the employer in the preceding year of more than the applicable dollar limit for that year.
5 This limit applies only to voluntary employee salary reduction (pre-tax) contributions.
6 This amount has been projected to increase to $2,700. However, as of November 8, 2018, the Internal Revenue Service has not confirmed the new limit.
