Bringing Clarity to a Complex World
The Internal Revenue Service announced the dollar limitations of pension plans and other items beginning January 1, 2012. Many of the pension plan limitations will change for 2012 because the increase in the cost of living index met the statutory thresholds that trigger their adjustment.
Limitations
2011 Amount
2012 Amount
Maximum Annual Compensation taken into account for determining benefits or contributions to a qualified plan
$245,000
$250,000
Basic Elective Deferral Limitation for 401(k), 403(b) and 457 Plans
$16,500
$17,000
Catch-Up Contribution limit for persons age 50 and older in 401(k), 403(b) and 457 Plans
$5,500
$5,500
Limitation on Annual Additions to a Defined Contribution Plan
$49,000
$50,000
Limitation on Annual Benefits from a Defined Benefit Plan
$195,000
$200,000
Highly Compensated Employee Compensation Threshold
$110,000
$115,000
Social Security Taxable Wage Base for Social Security Tax (6.2%*) For Medicare Tax (1.45%)
$106,800 No Limit
$110,100 No Limit
Health Savings Account - Individual Contribution Limit - Family Contribution Limit - Catch-Up Contributions
$3,050 $6,150 $1,000
$3,100 $6,250 $1,000
$11,500 $2,500
$11,500 $2,500
IRA: -
$5,000 $1,000
$5,000 $1,000
* Reduced to 4.2% through February 2012 (may be extended)
Simple 401(k) IRA: - Individual Contribution Limit - Catch-Up Contributions Individual Contribution Limit Catch-Up Contributions
For more information on this topic please contact a member of our personal tax team or a member of our 401(k) team at the contact information listed below. Personal Tax Team
Dennis Stein Pam Duffy Janet Graves John Bingham
dstein@teamdkb.com pduffy@teamdkb.com jgraves@teamdkb.com jbingham@teamdkb.com
39 State Street, Suite 600 Rochester, New York 14614 www.teamdkb.com phone 585.546.1840 fax 585.546.4486
401(k) Team
Tim Thaney Matt Hanley
tthaney@teamdkb.com mhanley@teamdkb.com