401k, 403b, IRA Contribution and Income Limit Changes from Officially Released by IRS

11 comments

[Update] You can now see the most up-to-date 401K/403b, IRA and Roth IRA limits here

_____________________

The IRS has released the latest 401k, 403b, IRA and other retirement/thrift plan contribution and income limits. With COLA remaining unchanged again this year, 2011 plan limits have also remained largely unchanged for the third year in a row. Income thresholds have marginally increased over last year.

Here is a summary of the main changes with links to more detailed articles:

401(k), 403(b), or 457(b) Plans

– The elective deferral (contribution) limit for employees who participate in employer sponsored 401k, 403b, or 457b plans, and the federal government’s Thrift Savings Plan remains unchanged at $16,500.

– The catch-up contribution limit under those plans for those aged 50 and over remains unchanged at $5,500, making the total contribution maximum for those in this age group $22,000.

See 2011 vs 2010 401K, 403b Contribution Limits and Rules for more details

IRA Plans

–  The tax deduction for taxpayers making contributions to a traditional IRA is phased out for singles and heads of household who are active participants in an employer-sponsored retirement plan and have modified adjusted gross incomes (AGI) between $56,000 and $66,000, unchanged from 2010.

– For married couples filing jointly, in which the spouse who makes the IRA contribution is an active participant in an employer-sponsored retirement plan, the income phase-out range for claiming a tax deduction on contributions in 2011  is $90,000 to $110,000, up from $89,000 to $109,000.

– For an IRA contributor who is not an active participant in an employer-sponsored retirement plan and is married to someone who is an active participant, the contribution tax deduction in 2011 is phased out if the couple’s income is between $169,000 and $179,000, up from $167,000 and $177,000.

See this article for more IRA plan rules and contribution limits

Roth IRA

– The AGI phase-out range for taxpayers making contributions to a Roth IRA is $169,000 to 179,000 for married couples filing jointly, up from $167,000 to $177,000 in 2010.

– For singles and heads of household, the income phase-out range is $107,000 to $122,000, up from $105,000 to $120,000.

– For a married individual filing a separate return who is an active participant in an employer-sponsored retirement plan, the phase-out range remains $0 to $10,000.

See this article for more on Roth IRA contribution and conversion rules

Other Limits

– The AGI limit for the saver’s credit for low-and moderate-income workers is $56,500 for married couples filing jointly, up from $55,500 in 2010; $42,375 for heads of household, up from $41,625; and $28,250 for married individuals filing separately and for singles, up from $27,750.

– The limitation regarding SIMPLE retirement accounts remains unchanged at $11,500.

The IRS will soon be releasing their 2011 tax brackets and I will post these details when available. I encourage you to subscribe (free) via Email or RSS to get the latest updates.

Official source : IRS.gov

Leave a Reply

11 Comments on "401k, 403b, IRA Contribution and Income Limit Changes from Officially Released by IRS"


[…] = {"data_track_clickback":true};The 2012 IRA and Roth IRA limits are likely to stay the same as 2011 limits due to the low levels of inflation that determine whether the IRS increase limits. This means the […]

[…] maximum tax deductible IRA contribution (annual limit) for the latest tax year is $5,000 (or $6,000 if you […]

[…] retirement plans with investors being able to deduct all or part of their contributions from pretax income if certain conditions are met. Like a 401K, the official retirement age at which […]

[…] you to contribute up to $15,500 of your salary to a special account set up by your company. Future contribution limits will be adjusted for inflation. Keep in mind that individual plans may have lower limits on the […]

[…] markets staging a strong recovery the average returns on a tax advantaged retirement plan like a 401(k) and IRA have been around 11% according to Morningstar (at this rate your money will double every 5 or so […]

[…] important and valuable asset? Think about it for a minute. Is it your house? Your savings or your 401(k) retirement plan? Your sports car or rare […]

Robert
Friday 7:06 pm

what should you in terms of 401(k) if your employer is no longer matching?

andys2i
Friday 7:07 pm

You should keep contributing. Your employer match is a bonus, so treat it like that. If you get it, great; but it should not stop you contributing as much as possible within the IRS prescribed limit.

2011 403b, Thrift Savings Plan and IRA Contribution and Income Limit Changes from 2010 | Government & Military Pay, Benefits and Taxes
Thursday 10:56 am

[…] IRS has released the latest 401k, 403b, IRA and other retirement/thrift plan contribution and income limits. With COLA […]

[…] [Updated Nov 2010 with 2011 Roth IRA Limits] Following my recently updated article on new 401K and IRA limits, I thought I would look at some of the changes being made around traditional and Roth IRA’s […]

» 2011 vs 2010 Traditional IRA versus Roth IRA – Contribution and Phase-out Income Limits | Saving to Inve$t
Wednesday 11:18 pm

[…] Andys2i [Updated Nov 2010] The IRS has released the official 2011 401K and IRA Limits. These have been updated based on 2011 cost of living adjustments (COLA) which remained unchanged […]

wpDiscuz

Previous post:

Next post:

Disclaimer: The information contained on Saving to Invest (this site) is for general information purposes only and does not constitute factual or professional financial advice. In accordance with FTC guidelines, we disclose that we may have a financial relationship with some of the merchants/companies mentioned on this website. We do our best to maintain current information, but due to the rapidly changing environment, some information may have changed since it was published. Please do the appropriate research before participating in any third party offers. Refer to the Privacy Policy and Terms of Use for more information