IRS Annual Limits on Qualified Plans for 2018

By Mark Wilkins and Abby Clark

On October 19, 2017, the Internal Revenue Service released the 2018 cost-of-living adjustments affecting dollar limits on benefits and contributions for qualified retirement plans. The Notice providing the cost-of-living adjustments is available here. The IRS also announced various other inflation adjustments in a new revenue procedure (including an adjustment to the dollar limitation for flexible spending accounts). The IRS previously announced the adjustments for Health Savings Accounts earlier this year. Last week, the Social Security Administration also announced its cost-of-living adjustments for the upcoming year.

The following chart summarizes the 2018 limits for benefit plans. The 2017 limits are provided for reference.

      2017     2018
Elective Deferral Limit 401(k), 403(b), 457(b)   $18,000   $18,500
Catch-up Limit (age 50+)   $6,000   $6,000
Defined Benefit Limit   $215,000   $220,000
Defined Contribution Limit   $54,000   $55,000
Dollar Limit - Highly Compensated Employees   $120,000   $120,000
Officer - Key Employee   $175,000   $175,000
Annual Compensation Limit   $270,000   $275,000
SEP Eligibility Compensation Limit   $600   $600
SIMPLE Deferral Limit   $12,500   $12,500
SIMPLE Catch-up Limit (age 50-+)   $3,000   $3,000
Social Security Taxable Wage Base   $127,200   $128,700
ESOP 5 Year Distribution Extension Account Minimum   $1,080,000   $1,105,000
Additional Amount for 1-Year Extension   $215,000   $220,000
HSA (Self/Family) Maximum Annual Contribution   $3,400/$6,750   $3,450/$6,900
HDHP Minimum Deductible Limits   $1,300/$2,600   $1,350/$2,700
Out-of-pocket Expense Annual Maximum   $6,550/$13,100   $6,650/$13,300
Medical FSA   $2,600   $2,650

For more information on the 2018 cost-of-living adjustments, please contact Mark Wilkins, Abby Clark or the Stinson Leonard Street contact with whom you regularly work.


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