The IRS has released 2018 cost-of-living adjustments for limits on employee benefits with some adjustments to the 2017 rates including minor increases to the maximum benefits allowed under Code Section 415, maximum compensation used in determining benefits and the taxable wage base. Below is an updated chart on 2018 limits.

Limits for 2018 – Qualified Plans

Limitation

2017

2018

Elective Deferrals (401(k) and 403(b) pre-tax contributions; 457(b), 402(g)(3))

$18,000

$18,500

Catch-up Contributions – 401(k), 403(b), 457(b), SARSEP plans

$6,000

$6,000

Highly Compensated Employee (HCE) – 414(q)

$120,000

$120,000

Annual Compensation Limit – 401(a)(17), 404(l), 408(k)(3)(C), 408(k)(6)(D)(ii)

$270,000

$275,000

Key employee – 416(i)(1)(A)(i), top heavy and 409A specified employee

$175,000

$175,000

Defined Contribution Plan total annual contributions – 415(c)

$54,000

$55,000

Defined Benefit Plan Maximum benefit – 415(b)

$215,000

$220,000

ESOP – for determining the length of the general five-year distribution period

$215,000

$220,000

ESOP – maximum account balance subject to five-year distribution period

$1,080,000

$1,105,000

Limits for 2018 – Tax Withholding Rates

Limitation

2017

2018

Taxable Wage Base

$127,200

$128,700

Limits for 2018 – High Deductible Plans, Health Savings Account and FSAs

Limitation

2017

2018

High Deductible health plan – IRS limits self/family

-annual deductible –minimum

-out of pocket expenses (HSA) – maximum

$1,300/$2,600

$6,550/$13,100

$1,350/$2,700

$6,650/$13,300

HSA Contribution limit – individual/family

$3,400/$6,750

$3,450/$6,900

HSA Contribution catch-up

$1,000

$1,000

FSA (flexible spending account – health)

$2,600

$2,650

FSA (dependent care account)

$5,000

$5,000

Out of pocket expenses (ACA) -PHSA §2707(b) maximum (in-network essential health benefits for non-grandfathered plans)

  • Self Only
  • Embedded Individual Max within Family Coverage
  • Family

$7,150

$7,150

$14,300

$7,350

$7,350

$14,700

Limits for 2018 – Qualified Transportation Fringes

Limitation

2017

2018

Qualified parking benefits/month

$255

$260

Combined transit and carpooling

$255

$260

Limits for 2018 – Affordable Care Act

Limitation

2017

2018

ACA affordability safe harbor

9.69%

9.56%