Updated Employee Benefit Plan and IRA Quick Reference Table 2015 and 2016
The Internal Revenue Service has announced the cost-of-living adjustments applicable to dollar limitations for various qualified retirement plans and other amounts for 2016(1). Many of the pension plan limitations will not change for 2016 because the increase in the cost-of-living index did not meet the statutory thresholds that trigger their adjustment. Plan sponsors should verify that their administrative and payroll systems reflect the appropriate limits. Communications that specify benefit plan limits should be reviewed for accuracy before materials are given to participants.
| 2015 | 2016 | |
| Compensation limit—IRC Sec. 401(a)(17) | $265,000 | $265,000 |
| Defined benefit plan annual benefit limit | $210,000 | $210,000 |
| Defined contribution plan annual contribution limit | $53,000 | $53,000 |
| Social Security tax wage base | $118,500 | $118,500 |
| Highly compensated employee compensation threshold | $120,000 | $120,000 |
| Key employee officer compensation threshold | $170,000 | $170,000 |
| SEP compensation threshold | $600 | $600 |
| 401(k), 403(b), and SARSEPs | ||
| Elective deferral limit(2) | $18,000 | $18,000 |
| Catch-up contribution(3) | $6,000 | $6,000 |
| 457 Plan | ||
| Elective deferral limit(2) | $18,000 | $18,000 |
| Catch-up contribution(3) | $6,000 | $6,000 |
| SIMPLE Plan | ||
| Elective deferral limit(2) | $12,500 | $12,500 |
| Catch-up contribution(3) | $3,000 | $3,000 |
| IRA | ||
| Elective deferral limit(2) | $5,500 | $5,500 |
| Catch-up contribution(3) | $1,000 | $1,000 |
| Traditional IRA deduction phaseout (AGI) | ||
| Single, Head of Household—active participant | $61,000/$71,000 | $61,000/$71,000 |
| Married Filing Separate—any spouse participates | $0/$10,000 | $0/$10,000 |
| Married Filing Joint—nonparticipating spouse | $183,000/$193,000 | $184,000/$194,000 |
| Married Filing Joint—participating spouse | $98,000/$118,000 | $98,000/$118,000 |
| Roth IRA contribution eligibility (AGI) | ||
| Married Filing Joint | $183,000/$193,000 | $184,000/$194,000 |
| Single, Head of Household | $116,000/$131,000 | $117,000/$132,000 |
| Married Filing Separate—any spouse participates | $0/$10,000 | $0/$10,000 |
| Retirement saver’s credit eligibility (AGI) | ||
| Married Filing Joint | $61,000 | $61,500 |
| Head of Household | $45,750 | $46,125 |
| Married Filing Separate, Single | $30,500 | $30,750 |
| (1) This table has been updated based on IRS News Release (IR-2015-118), October 21, 2015. | ||
| (2) This applies to the total of all elective deferrals an individual makes for the year to 401(k) plans, 403(b) plans, SARSEPs, and SIMPLE plans. However, deferrals to each SIMPLE plan in which the individual participates are also limited, as shown later in the table. | ||
| (3) Catch-up contributions are available each year to individuals who reach age 50 by December 31. | ||
If you have any questions, or for more information about the 2016 cost-of-living adjustments for retirement plans, please contact Pam Branshaw, Tom Krieg, Bob Buss, or your Wipfli relationship executive.
