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Internal Revenue Service and Social Security Administration announce benefit limits for 2018

October 27, 2017

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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