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November 1, 2018 TO: ICI MembersPension Committee
Pension Operations Advisory Committee SUBJECTS: Pension RE: IRS Announces Retirement Plan Limitations for 2019
The Internal Revenue Service has released annual cost of living and other adjustments applicable to dollar limitations for pension and retirement plans. The news release is available here and Notice 2018-83, which also contains the updated limits, is available here . Notably, the elective deferral limit for participants in 401(k), 403(b) and most 457 plans has increased to $19,000, and the contribution limit for IRAs has increased to $6,000. Effective for tax year 2019, the dollar limitations include, but are not limited to, the following:
Limit
2018
2019
Defined benefit plan limit, IRC § 415(b)(1)(A)
$220,000
$225,000
Defined contribution plan limit, IRC § 415(c)(1)(A)
$55,000
$56,000
Annual compensation limit, IRC §§ 401(a)(17), 404(l), 408(k)(3)(C) and 408(k)(6)(D)(ii)
$275,000
$280,000
Limit used for definition of highly compensated employee, IRC § 414(q)(1)
$120,000
$125,000
Elective deferral limit, IRC § 402(g)
$18,500
$19,000
Deferral limit for state and local governments and tax-exempt organizations, IRC § 457(e)(15)
$18,500
$19,000
SEP compensation amount, IRC § 408(k)(2)(C)
$600
$600
SIMPLE contribution limit, IRC § 408(p)(2)(E)
$12,500
$13,000
Catch-up contributions to qualified plans, 403(b) plans and 457 plans, IRC § 414(v)(2)(B)(i)
$6,000
$6,000
Catch-up contributions to SIMPLE plans, IRC § 414(v)(2)(B)(ii)
$3,000
$3,000
IRA contribution limit, IRC § 219(b)(5)(A)
$5,500
$6,000
Catch-up contributions to IRAs, IRC § 219(b)(5)(B)
(this amount is not adjusted for cost of living)
$1,000
$1,000
QLAC premium limit, Treas. Reg. § 1.401(a)(9)-6, A-17(b)(2)(i)
$130,000
$130,000
The news release describes all plan limits for 2019 and provides updated income limits for determining (1) eligibility for the saver’s credit (IRC § 25B(b)), (2) the deductible amount of a traditional IRA contribution (IRC § 219(g)), and (3) the maximum Roth IRA contribution (IRC § 408A(c)(3)(B)(ii)).
Shannon Salinas
Assistant General Counsel - Retirement Policy