2018 Qualified Plan Cost of Living Increases, 2018 Social Security Taxable Wage Base – Updated for New Taxable Wage Base

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October 19, 2017

The Internal Revenue Service has announced the cost-of-living adjustments for the various qualified retirement plan limits. A few of the limits shown below remain unchanged from last year, but others have increased.

Qualified Plan Limit

Cost-of-Living Adjustments

401(k) and 403(b) elective deferral limit

2017-$18,000

2018-$18,500

$200,000 compensation limit

2017-$270,000

2018-$275,000

$160,000 defined benefit limit

2017-$215,000

2018-$220,000

$40,000 defined contribution limit

2017-$54,000

2018-$55,000

$80,000 definition of highly compensated employee

2017-$120,000

2018-$120,000

SIMPLE IRA deferral limit

2017-$12,500

2018-$12,500

Code Section 457 deferred compensation plan deferral limit

2017-$18,000

2018-$18,500

Code Section 414(v) catch-up contribution limit for employee deferrals

2017-$6,000

2018-$6,000

 

All of the above are plan year limits (i.e., for the plan year which begins in 2018), with the exception of the Code Section 401(k) and Code Section 403(b) elective deferral limit, which is a calendar year limitation.

In addition, the Department of Health and Human Services has set the maximum taxable wages for the OASDI portion of the social security tax at $128,700 for 2018, which is an increase from the 2017 limit of $127,200.

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