2018 IRS Limits Announced

by | Nov 8, 2017

On October 19, 2017, the Internal Revenue Service announced dollar limitations for pension plans and other retirement-related items for 2018.  The Social Security Administration announced the 2018 Taxable Wage Base a week earlier, while the Pension Benefit Guaranty Corporation finalized 2018 guarantees on October 30, 2017.

 

See the table below for a summary of these updates and a comparison of prior limits.

Category20182017201620152014IRC Citation
Annual compensation limit$275,000 $270,000 $265,000 $265,000 $260,000 401(a)(17)
Limitation on the annual benefit under a defined benefit plan$220,000 $215,000 $210,000 $210,000 $210,000 415(b)
Limitation on annual additions for defined contribution plans$55,000 $54,000 $53,000 $53,000 $52,000 415(c)
Elective deferral (contribution) limit for 401(k) & 403(b) plans$18,500 $18,000 $18,000 $18,000 $17,500 402(g)
Catch-up contribution limit for employees aged 50 and over$6,000 $6,000 $6,000 $6,000 $5,500 414(v)
Dollar limitation in the definition of highly compensated employee$120,000 $120,000 $120,000 $120,000 $115,000 414(q)
Dollar limitation in the definition of key employee (for top-heavy)$175,000 $175,000 $170,000 $170,000 $170,000 416(i)
Health Savings Account (HSA) annual contribution limit: (self-only / family coverage)$3,450 / $6,900 $3,400 / $6,750 $3,350 / $6,750 $3,350 / $6,650$3,300 / $6,550 223(b)(2)
Maximum amount of earnings subject to the Social Security tax$128,400 $127,200 $118,500 $118,500 $117,000 N/A
PBGC monthly guaranteed benefit at age 65$5,420 $5,369 $5,011 $5,011 $4,943 N/A
PBGC per-participant flat rate premium$74$69$64$57$49N/A
PBGC variable rate premium (VRP) %3.80%3.40%3.00%2.40%1.40%N/A
PBGC VRP maximum per participant$523$517$500$418$412N/A

The IRS release can be found here

A PDF version of this chart can be found here

 

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SECURITY INDICES: This presentation includes data related to the performance of various securities indices.  The performance of securities indices is not subject to fees and expenses associated.  Investments cannot be made directly in the indices.   The information provided herein has been obtained from sources which River and Mercantile LLC believes to be reasonably reliable but cannot guarantee its accuracy or completeness.

CONFIDENTIAL:  For addressee use only, not to be disclosed to any other person without express consent from River and Mercantile LLC.  Past performance cannot be relied upon to predict future results.  River and Mercantile LLC is an investment advisor registered with the US Securities and Exchange Commission.

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