Last month, the Internal Revenue Service released Notice 2017-64, which provides the annual cost-of-living adjustments and contribution limits on 401(k) plans, pension plans, and other retirement accounts for 2018.
For employees enrolled in 401(k), 403(b), most 457 plans, and the federal thrift savings plan; contribution limits have increased from $18,000 to $18,500 in 2018. Catch-up contribution limitation for employees aged 50 and over, however, remains the same at $6,000.
For those with traditional individual retirement accounts (IRAs), Roth IRA accounts, or to claim the saver's credit, below is a summary of the new income allowances that determine taxpayers' eligibility for deductible contributions in 2018:
Traditional IRAs (If covered by a retirement plan at work)
Any taxpayer contributing to an IRA account that is not covered by a workplace is not subject to deduction phase-outs.
Saver's Credit (Retirement Savings Contributions Credit) Income Limits
For 2018, the contribution limits on IRA accounts will remain the same; $5,500 with an annual catch-up limit for taxpayers 50 or older of an additional $1,000. To discuss further or if you have any questions, contact your professional at UHY LLP in one of our many locations.