2011 401K Limits

The Internal Revenue Service today announced cost of living adjustments affecting dollar limitations for pension plans and other retirement-related items for tax year 2011. In general, these limits will either remain unchanged, or the inflation adjustments for 2011 will be small. Highlights include:

The elective deferral (contribution) limit for employees who participate in section 401(k), 403(b), or 457(b) plans, and the federal government’s Thrift Savings Plan remains unchanged at $16,500.
The catch-up contribution limit under those plans for those aged 50 and over remains unchanged at $5,500.

The deduction for taxpayers making contributions to a traditional IRA is phased out for singles and heads of household who are active participants in  an employer-sponsored retirement plan and have modified adjusted gross incomes (AGI) between $56,000 and $66,000, unchanged from 2010. For married couples filing jointly, in which the spouse who makes the IRA contribution is an active participant in an employer-sponsored retirement plan, the income phase-out range is $90,000 to $110,000, up from $89,000 to $109,000. For an IRA contributor who is not an active participant in an employer-sponsored retirement plan and is married to someone who is an active participant, the deduction is phased out if the couple’s income is between $169,000 and $179,000, up from $167,000 and $177,000.

The AGI phase-out range for taxpayers making contributions to a Roth IRA is $169,000 to 179,000 for married couples filing jointly, up from $167,000 to $177,000 in 2010. For singles and heads of household, the income phase-out range is $107,000 to $122,000, up from $105,000 to $120,000. For a married individual filing a separate return who is an active participant in an employer-sponsored retirement plan, the phase-out range remains $0 to $10,000.

The AGI limit for the saver’s credit (also known as the retirement savings contributions credit) for low-and moderate-income workers is $56,500 for married couples filing jointly, up from $55,500 in 2010; $42,375 for heads of household, up from $41,625; and $28,250 for married individuals filing separately and for singles, up from $27,750.

2010 limits are here.

2010 401(K) Conributions

The IRS announced 2010 pension plan and retirement plan contribution limits today. This limitation affects elective deferrals to Section 401(k) plans and to the Federal Government’s Thrift Savings Plan, among other plans.

Most limits were kept the same as 2009 due to minimal inflation. "This is because the cost-of-living index for the quarter ended September 30, 2009, is less than the cost-of-living index for the quarter ended September 30, 2008,"

2010 401 K contribution limits are as follows:
2010 401k Contribution Limit: $16,500
2010 Catch-Up Contribution Limit (if you are age 50 years old and older): $5,500

You are also subject to the limits imposed by your company’s 401k plan. Matching contributions, if any, provided by your employer do NOT effect these limits. Check with your employer to see if they have any contribution limits.

You can find 2009 Contribution Limits here.

2009 401K contribution limits

IRS announced last week the 401K plan contribution limits for 2009. However, investing doesn't seem too attractive in today's current economic climate. If your 401K plan has interesting options to choose from, then now can be a good time to purchase some funds at some low prices.

2009 401 K contribution limits are as follows:

2009 401k Contribution Limit: $16,500
2009 Catch-Up Contribution Limit (if you are age 50 years old and older): $5,500

You are also subject to the limits imposed by your company’s 401k plan. Matching contributions, if any, provided by your employer do NOT effect these limits. Check with your employer to see if they have any contribution limits.

You can find 2008 Contribution Limits here.

There is talk in Congressional committees about removing the tax benefits of 401(k)'s. So, take advantage of the tax benefits while you can -- especially if you have employer matching.

You can find the text of the IRS release and other Pension Plan limitations on the IRS Website. It lists contribution and income limitations for IRA's, SEP's and other such technical plans.

2008 401K Contribution Limits

OK, since I have such a VAST amount of readers (you know who I am), you will forgive me for writing a note to myself. I keep forgetting the IRS limits for 401K contributions. So, I thought I would write a note for myself and others. For 2008, the maximum amounts you can contribute to your 401(k) plan, as set by the IRS is shown below:

2008 401k Contribution Limit: $15,500
2008 Catch-Up Contribution Limit (if you are over 50 years old): $5,000

These are the IRS limits, but you are also subject to the limits imposed by your company’s 401k plan. Matching contributions, if any, provided by your employer do NOT effect these limits. Check with your employer to see if they have any contribution limits.

Now, I wonder how many start-up companies offer 401 (k) programs. They are incentives that are valuable to some, but not necessarily all. I wonder how rare it is to provide any matching funds, and if data is kept on these sort of statistics.

You can find 2009 401k contribution limits here.