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401k and Retirement Plan Limits for the Tax Year 2016

Plan limits for 2017 can be found here.

On October 21, 2015, the Internal Revenue Service announced cost of living adjustments affecting dollar limitations for pension plans and other retirement-related items for tax year 2016. In general, the pension plan limitations will not change for 2016 because the increase in the cost-of-living index did not meet the statutory thresholds that trigger their adjustment. However, other limitations will change because the increase in the index did meet the statutory thresholds.


Chart of Select Limits              
               
401k Plan Limits for Year 2016 2015 2014 2013 2012 2011 2010
401k Elective Deferrals $18,000 $18,000 $17,500 $17,500 $17,000 $16,500 $16,500
Annual Defined Contribution Limit $53,000 $53,000 $52,000 $51,000 $50,000 $49,000 $49,000
Annual Compensation Limit $265,000 $265,000 $260,000 $255,000 $250,000 $245,000 $245,000
Catch-Up Contribution Limit $6,000 $6,000 $5,500 $5,500 $5,500 $5,500 $5,500
Highly Compensated Employees $120,000 $120,000 $115,000 $115,000 $115,000 $110,000 $110,000
 
Non-401k Related Limits
403(b)/457 Elective Deferrals $18,000 $18,000 $17,500 $17,500 $17,000 $16,500 $16,500
SIMPLE Employee Deferrals $12,500 $12,500 $12,000 $12,000 $11,500 $11,500 $11,500
SIMPLE Catch-Up Deferral $3,000 $3,000 $2,500 $2,500 $2,500 $2,500 $2,500
SEP Minimum Compensation $600 $600 $550 $550 $550 $550 $550
SEP Annual Compensation Limit $265,000 $265,000 $260,000 $255,000 $250,000 $245,000 $245,000
Social Security Wage Base $118,500 $118,500 $117,000 $113,700 $110,100 $106,800 $106,800


Download a PDF of this chart.

Highlights of limitations that changed from 2015 to 2016 include the following:

  • For an IRA contributor who is not covered by a workplace retirement plan and is married to someone who is covered, the deduction is phased out if the couple's income is between $184,000 and $194,000, up from $183,000 and $193,000.
  • The AGI phase-out range for taxpayers making contributions to a Roth IRA is $184,000 to $194,000 for married couples filing jointly, up from $183,000 to $193,000. For singles and heads of household, the income phase-out range is $117,000 to $132,000, up from $116,000 to $131,000.
  • The AGI limit for the saver's credit (also known as the retirement savings contribution credit) for low- and moderate-income workers is $61,500 for married couples filing jointly, up from $61,000; $46,125 for heads of household, up from $45,750; and $30,750 for married individuals filing separately and for singles, up from $30,500.

The next page contains details on both the unchanged and adjusted limitations for 2016.

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