On October 18, 2012, the IRS announced the 2013 cost of living adjustments affecting dollar limitations for qualified retirement plans. The highlights are as follows:
- Elective Deferrals. The elective deferral (contribution) limit for employees who participate in 401(k), 403(b), most 457 plans and the federal government's Thrift Savings Plan is increased from $17,000 to $17,500.
- Catch-Up Contributions. The catch-up contribution limit for employees aged 50 and over who participate in 401(k), 403(b), most 457 plans and the federal government's Thrift Savings Plan remains at $5,500.
- Annual Compensation Limit. The annual compensation limit under Code sections 401(a)(17), 404(l), 408(k)(3)(C) and 408(k)(6)(D)(ii) is increased from $250,000 to $255,000.
- Annual Additions Limit. The annual additions limitation for a defined contribution plan under Code section 415(c)(1)(A) is increased in 2013 from $50,000 to $51,000.
- Annual Benefit Limit. The limitation on the annual benefit under a defined benefit plan under Code section 415(b)(1)(A) is increased from $200,000 to $205,000.
- Definition of Highly Compensated Employee. The limitation used in the definition of highly compensated employee under Code section 414(q)(1)(B) remains unchanged at $115,000.
The entire list of changes can be found at: http://www.irs.gov/uac/2013-Pension-Plan-Limitations