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The IRS recently announced the 2016 retirement limits. These limits are adjusted each year based on the cost of living index and, due to low inflation, most retirement limits will remain the same as 2015.  


    2016   2015
401(k), 403(b) or 457(b) plan elective deferrals   $ 18,000   $ 18,000
401(k), 403(b) or 457(b) plan catch up contributions for those age 50 and older   $ 6,000   $ 6,000
Maximum contribution to a defined contribution plan (Section 415(c)(1)(A))   $ 53,000   $ 53,000
SIMPLE plan employee deferrals   $ 12,500   $ 12,500
SIMPLE plan catch-up contributions   $ 3,000   $ 3,000
Maximum annual benefit under a defined benefit plan (Section 415(b)(1)(A))   $ 210,000   $ 210,000
Annual compensation limit   $ 265,000   $ 265,000
Key employee compensation in top-heavy plan (Section 416(i)(1)9A)(i))   $ 170,000   $ 170,000
Highly compensated employee (Section 414(q)(1)(B))   $ 12,000   $ 12,000
Maximum ESOP account balance subject to 5-year distribution preiod   $ 1,070,000   $ 1,070,000
Threshold for determining if a multiemployer plan is a systematically important plan (Section 432(e)(9)(H)(v)(III)(aa))   $ 1,012,000,000   $ 1,000,000,000


A few other changes noted by the IRS were:

For an IRA contributor who is not covered by a workplace retirement plan and is married to someone who is covered, the deduction is phased out if the couple's income is between $184,000 and $194,000-up from $183,000 and $193,000.

The adjusted gross income (AGI) phase-out range for taxpayers making contributions to a Roth IRA is $184,000 to $194,000 for married couples filing jointly, up from $183,000 to $193,000. For singles and heads of household, the income phase-out range is $117,000 to $132,000-up from $116,000 to $131,000.

The AGI limit for the saver's credit (also known as the retirement savings contribution credit) for low- and moderate-income workers is $61,500 for married couples filing jointly, up from $61,000; $46,125 for heads of household, up from $45,750; and $30,750 for married individuals filing separately and for singles-up from $30,500.  


For more information or questions on this topic, please contact your professional at UHY LLP.