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Internal Revenue Service and Social Security Administration announce benefit limits for 2018
Overview
The Internal Revenue Service and Social Security Administration have announced the various retirement plan benefit and employment tax limits for 2018. In contrast to recent years, the limitations for 2018 will increase, including for 401(k) deferrals. Increases also apply to the retirement plan annual compensation limit, the Social Security FICA wage base and the limit on contributions permitted to be made to a health care FSA.
The limits for 2018, as compared to those in effect for the current year, are set forth below. The limits that have changed are printed in bold.
| Retirement Plan Limits | ||
| 2017 | 2018 | |
| Limits on benefits and contributions 401(k) & 403(b) plans, elective deferral limit 457(b) plan, total contribution limit Age 50 catch-up contribution limit Defined contribution plan, total contribution limit Defined benefit plan, annual accrual limit | $18,000 $18,000 $6,000 $54,000 $215,000 | $18,500 $18,500 $6,000 $55,000 $220,000 |
| “Highly compensated employee” status | $120,000 | $120,000 |
| Annual compensation limit | $270,000 | $275,000 |
| “Key employee” officer status | $175,000 | $175,000 |
| SIMPLE plans Elective deferral limit Catch-up contribution limit | $12,500 $3,000 | $12,500 $3,000 |
| IRAs Contribution limit Catch-up contribution limit | $5,500 $1,000 | $5,500 $1,000 |
| Social Security Limits | ||
| 2017 | 2018 | |
| FICA wage base | $127,200 | $128,700 |
| Earnings test thresholds Before normal retirement age Year of normal retirement age | $16,920 $44,880 | $17,040 $45,360 |
| Maximum monthly benefit | $2,687 | $2,788 |
| Health Savings Accounts | ||
| 2017 | 2018 | |
| Annual HSA contribution deduction limit Self-only coverage Family coverage Catch-up contribution | $3,400 $6,750 $1,000 | $3,450 $6,900 $1,000 |
| Out-of-pocket spending limit Self-only coverage Family coverage | $6,550 $13,100 | $6,650 $13,300 |
| Minimum annual deductible Self-only coverage Family coverage | $1,300 $2,600 | $1,350 $2,700 |
| Health Care FSA | ||
| 2017 | 2018 | |
| Annual salary reduction limit | $2,600 | $2,650 |
| Qualified Transportation Fringe Benefit | ||
| 2017 | 2018 | |
| Maximum monthly qualified parking benefit | $255 | $260 |
| Maximum monthly qualified transit pass benefit | $255 | $260 |
For further information or questions regarding the 2018 benefit limits, please contact Wally Miller at 541-686-3299 or wmiller@schwabe.com.
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