The IRS recently announced cost-of-living adjustments for 2019. Below is a list of some of the key annual limits that will apply to qualified retirement plans in 2019:
- Compensation limit used in calculating a participant’s benefit accruals: increased to $280,000.
- Elective deferrals to 401(k) and 403(b) plans: increased to $19,000.
- Annual additions to a defined contribution plan: increased to $56,000.
- Catch-up contributions for employees aged 50 and over to 401(k) and 403(b) plans: remains unchanged at $6,000.
- Annual benefit limit for a defined benefit plan: increased to $225,000.
- Compensation dollar limit for defining a “key employee” in a top heavy plan: increased to $180,000.
- Compensation dollar limit for defining a “highly compensated employee”: increased to $125,000.