Adjustments in Retirement Plan Limits

The IRS has announced its annual cost-of-living adjustments for certain retirement plan thresholds. Due to relatively low inflation rates, the adjustments for 2017 are minimal or nonexistent, as shown below.

Maximum annual dollar benefit for a
defined benefit plan                                                                         $210,000                         $215,000

Maximum dollar limit on additions to
a defined contribution plan                                                             $53,000                            $54,000

Maximum amount of compensation taken into
account for qualified retirement plans                                         $265,000                         $270,000

Dollar limit for elective deferrals to a 401(k) plan*                      $18,000                           $18,000
(* $24,000 if age 50 or older)

Dollar limit for contributions to a SIMPLE plan*                          $12,500                           $12,500
(* $15,500 if age 50 or older)

Note: The annual limit for contributions to traditional and Roth IRAs remains at $5,500 ($6,500 if age 50 or older) for 2017. Phase-out levels for IRA and Roth contributions are adjusted slightly.