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10.20.2011 Benefit limits and contributions for 2012
10.20.2011

 

 

The Commissioner of the Internal Revenue has adjusted the dollar limitations for benefits and contributions that apply to retirement plans.  The Social Security Administration has also adjusted the Social Security earnings limit.  The change in the 2012 limits was triggered by an increase in the cost-of-living index.  The following chart shows the 2012 limits and the expiring limits for 2011.

 

 

Benefit Limits Under the Internal Revenue Code and Social Security

 

Description

2012 limit

2011 limit

Compensation Cap under  401(a)(17)

$250,000

$245,000

Elective Deferral Limitation under 402(g)(1) for elective deferrals for 401(k) plans, SEPs and 403(b) plans

$17,000

$16,500

Catch Up Contributions for Individuals Age 50 and Older
   For  401(k) plans
 

   For SIMPLE IRAs or SIMPLE 401(k) plans

 

$5,500

$2,500

 

 $5,500 
$2,500

Defined Benefit Maximum

$200,000

$195,000

Defined Contribution Maximum

$50,000

$49,000

Highly Compensated Employee Compensation Limit

Key Employee in Top-Heavy Plans Compensation Limit


$115,000


$165,000


$110,000


$
160,000

ESOP Threshold for determining maximum account balance subject to 5-year distribution period

   Regular Limit

   Amount to lengthen 5-year period

 

 
 

$1,015,000

$200,000

 

 
 

$985,000

$195,000

SEP Compensation Threshold for Participation

$550

$550

SIMPLE IRA  Maximum Pre-Tax Contribution

$11,500

$11,500

Deferral Limit for Governments and Tax-Exempts (457(b))

$17,000

$16,500

IRA Maximum Deduction
IRA Age 50 Catch Up

$5,000
    $1,000    

$5,000
$1,000

Social Security Taxable Wage Base

$110,100

$106,800

Health Savings Account Maximum Contributions
   Family Coverage
   Single Coverage

 
 

$6,250
$3,100

 
 

$6,150
$3,050

 

 

 

For more information about this topic, please contact the author or any member of the Williams Mullen Employee Benefits & Executive CompensationTeam.