2009 Qualified Plan Cost of Living Increases, 2009 Social Security Taxable Wage Base

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October 20, 2008

The Internal Revenue Service has announced the cost-of-living adjustments for the various qualified retirement plan limits.

Qualified Plan Limit Cost-of-Living Adjustments
401(k) and 403(b) elective deferral limit 2008 – $15,500

2009 – $16,500

$200,000 compensation limit 2008 – $230,000

2009 – $245,000

$160,000 defined benefit limit 2008 – $185,000

2009 – $195,000

$40,000 defined contribution limit 2008 – $46,000

2009 – $49,000

$80,000 definition of highly compensated employee 2008 – $105,000

2009 – $110,000

SIMPLE IRA deferral limit 2008 – $10,500

2009 – $11,500

Code Section 457 deferred compensation plan deferral limit 2008 – $15,500

2009 – $16,500

Code Section 414(v) catch-up contribution limit for employee deferrals 2008 – $5,000

2009 – $5,500

All of the above are plan year limits (i.e., for the plan year which begins in 2009), 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 $106,800 for 2009.

If you have questions regarding the above, please contact Mary Ellen Schill, the author of this article, or any of the attorneys in the Employment & Benefits Practice Group of Ruder Ware.

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