Today we will address some retirement plan dollar limits for 2014. We delayed the discussion on the individual health care mandate until next week.
The IRS has announced the 2014 cost of living adjustments for retirement plans.
The limitation on the annual benefit under a defined benefit plan is increased from $205,000 to $210,000.
The limit on the annual additions to a participant's defined contribution account is increased from $51,000 to $52,000.
The maximum amount of annual compensation that can be taken into account for various qualified plan purposes is increased from $255,000 to $260,000.
The limit on the exclusion for elective deferrals remains unchanged at $17,500. This limitation affects elective deferrals to Section 401(k) plans, Section 403(b) plans, and the Federal Government's Thrift Savings Plan. The limit on catch up contributions was also unchanged.
The maximum amount of compensation an employee may elect to defer for a SIMPLE plan remains unchanged at $12,000.
Disclaimer: The items included in the Tax Tip Tuesday Video Blog are informational only and are not meant as tax advice. Consult with your tax advisor to determine how any item applies to your situation. IRS Circular 230 disclosure: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. federal tax advise contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.