2011 Qualified Plan Cost of Living Increases, 2011 Social Security Taxable Wage Base

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October 28, 2010

The Internal Revenue Service has announced the cost-of-living adjustments for the various qualified retirement plan limits. Note that all of the limits shown below are unchanged from 2010, because the relevant cost-of-living index for 2010 is less than the cost-of-living index for 2009, the basis for the cost-of-living increases.

Qualified Plan Limit Cost-of-Living Adjustments
401(k) and 403(b) elective deferral limit 2010 – $16,500

2011 – $16,500

$200,000 compensation limit 2010 – $245,000

2011 – $245,000

$160,000 defined benefit limit 2010 – $195,000

2011 – $195,000

$40,000 defined contribution limit 2010 – $49,000

2011 – $49,000

$80,000 definition of highly compensated employee 2010 – $110,000

2011 – $110,000

SIMPLE IRA deferral limit 2010 – $11,500

2011 – $11,500

Code Section 457 deferred compensation plan deferral limit 2010 – $16,500

2011 – $16,500

Code Section 414(v) catch-up contribution limit for employee deferrals 2010 – $5,500

2011 – $5,500

All of the above are plan year limits (i.e., for the plan year which begins in 2011), 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 2011.

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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