IRS Announces 2017 Retirement Plan Contribution Limits!

Changes, Changes, Changes.  Things are always changing in the tax law. Here are the just-announced 2017 Retirement Plan Contribution Limits:

  • 401(k) deferrals are unchanged at $18,000
  • 401(k) catch-up if age 50 or older is unchanged at $6,000
  • The annual contribution limit for defined contribution plans increased from $53,000 to $54,000 ( that means for a 50+ year old in a 401(k) plan, the maximum could be $60,000 with the catch-up)
  • The annual compensation limit increased from $265,000 to $270,000
  • The compensation threshold for highly compensated definition is unchanged at $120,000

In addition, Social Security Administration announced a significant increase in the taxable wage base from $118,500 to $127,200

This last change is significant as it affects wage earners and business owners whether they operate sole-proprietors, s-corporation owners, or with a different entity.