|
Printable version  |
|
The Internal Revenue Code provides dollar limitations on benefits and contributions of qualified retirement plans. It also requires the IRS to adjust these limits for cost‑of‑living increases on an annual basis.
The IRS recently announced the pension plan limitation changes for 2008.*
Here are the amounts (some remain unchanged):
| Annual Qualified Plan Limits |
2008 |
2007 |
|
Defined contribution plan dollar limit on additions
(Section 415(c)(1)(A)) |
$ 46,000 |
$ 45,000 |
|
Defined benefit plan limit on benefits (Section 415(b)(1)(A)) |
$185,000 |
$180,000 |
|
Maximum compensation used to determine contributions |
$230,000 |
$225,000 |
|
401(k), SARSEP, 403(b) Plan Deferrals (Section 402(g)) & 457 Plan deferrals (Section 457(b)(2)) |
$ 15,500 |
$15,500 |
|
401(k), 403(b), 457 & SARSEP additional "catch-up" contributions for employees age 50 and older |
$ 5,000 |
$ 5,000 |
|
SIMPLE deferrals (Section 408(p)(2)(A)) |
$ 10,500 |
$10,500 |
Simple additional "catch-up" contributions
for employees age 50 and older |
$ 2,500 |
$ 2,500 |
| The dollar amount under Section 409(o)(1)(C)(ii) to determine the maximum account balance in an employee stock ownership plan subject to a 5‑year distribution period, and the amount used to determine the lengthening of the 5‑year distribution period |
$935,000/
$185,000 |
$915,000/
$180,000 |
|
Compensation defining highly compensated employee (Section 414(q)(1)(B)) |
$105,000 |
$100,000 |
| Compensation defining key employee (officer) |
$150,000 |
$145,000 |
| The compensation amounts under Section 1.61‑21(f)(5)(i) of the Income Tax Regulations concerning the definition of "control employee" for fringe benefit valuation purposes |
$ 90,000 |
$ 90,000 |
|
Compensation triggering Simplified Employee Pension (SEP) contribution requirement (Section 408(k)(2)(c)) |
$ 500 |
$ 500 | * IRS note: "Administrators of defined benefit or defined contribution plans that have received favorable determination letters should not request new determination letters solely because of yearly amendments to adjust maximum limitations in the plans."
| If you would like information about our Employee Benefit Plan Audit services, please contact Manager Alicia D. Schmiedel, CPA, or visit our website for details. You can reach Alicia at 717-757-6999 or 800-745-8233, or send an email by using the form below. |
|
|
|
 |
Our firm provides the information in this e-newsletter for general guidance only, and does not constitute the provision of legal advice, tax advice, accounting services, investment advice, or professional consulting of any kind. The information provided herein should not be used as a substitute for consultation with professional tax, accounting, legal, or other competent advisers. Before making any decision or taking any action, you should consult a professional adviser who has been provided with all pertinent facts relevant to your particular situation. Tax articles in this e-newsletter are not intended to be used, and cannot be used by any taxpayer, for the purpose of avoiding accuracy-related penalties that may be imposed on the taxpayer. The information is provided "as is," with no assurance or guarantee of completeness, accuracy, or timeliness of the information, and without warranty of any kind, express or implied, including but not limited to warranties of performance, merchantability, and fitness for a particular purpose.
IRS Circular 230 Notice: To ensure compliance with requirements imposed by the IRS, we inform you that any US tax advice contained in this communication is not intended or written to be used, and cannot be used, for the purpose of avoiding penalties under the Internal Revenue Code.
Securities and advisory services offered through Geneos Wealth Management, Inc. Member FINRA/SIPC. Geneos Wealth Management, Inc is not affiliated with Stambaugh Ness. |
|
|
Full Newsletter
