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Northwest OH Legal Blog

Wednesday, March 25, 2015

Internal Revenue Service Issues 2015 Cost-of-Living Adjustments for Retirement Plan Limits

On October 23, 2014, the Internal Revenue Service (“IRS”) announced cost-of-living adjustments to dollar limitations for items affecting tax-qualified retirement plans under the Internal Revenue Code (“Code”) in 2015. The announcement includes the following highlights for 2015: 

  • The elective deferral (contribution) limit for employees who participate in section 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan is increased in 2015 from $17,500 to $18,000.
  • The catch-up contribution limit for the above listed plans for employees aged 50 and over is increased in 2015 from $5,500 to $6,000.
  • The limitation on the annual benefit under a defined benefit plan under Code Section 415(b)(1)(A) remains unchanged at $210,000.
  • The limitation for defined contribution plans under Code Section 415(c)(1)(A) is increased in 2015 from $52,000 to 53,000.

The following table sets forth the Code limits applicable to 401(k) plans, profit sharing plans, and defined benefit plans for 2015, with a comparison to such limits for 2013 and 2014. 

Limits under Applicable Code Section

2015

2014

2013

Annual Compensation - 401(a)(17)/404(l)

265,000

260,000

255,000

Elective Deferrals under 401(k) Plan - 402(g)(1)

18,000

17,500

17,500

Catch-Up Contributions under 401(k) Plan - 414(v)(2)(B)(i)

6,000

5,500

5,500

Annual Addition Limit for Defined Contribution Plans - 415(c)(1)(A)

53,000

52,000

51,000

Highly Compensated Employee Threshold - 414(q)(1)(B)

120,000

115,000

115,000

Annual Benefit Limit for Defined Benefit Plans - 415(b)(1)(A)

210,000

210,000

205,000

Key Employee Compensation Threshold - 416(i)(1)(A)(i)

170,000

170,000

165,000

Taxable Wage Base for Social Security Taxes

118,500

117,000

113,700

 


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