The IRS has released updated 2014 limits for defined contribution (or pension) plans such as 401(k) and IRAs. This was delayed from the usual mid-October release due to the government shutdown. The annual limits are tied to Cost of Living Adjustment (COLA) figures and based on these the updated 2014 limits and contribution amounts are shown below (all data is based on information from IRS.gov). Changes from 2013 are highlighted in yellow. There haven’t been too many changes to the statutory limits due to the low inflation environment.
The existing $17,500 limit for employees enrolled in an employee sponsored retirement plan (401k, 403b, and Thrift Savings Plans) will likely remain unchanged after three years of increases. Similarly, the catch-up contribution limit available to employees over 50, will remain unchanged at $5,500. The maximum limit for defined contribution plan deferrals from all sources (employer and employee combined) increases to $52,000 per participant from $51,000 in 2013.
Traditional and Roth IRA contribution limits are projected to stay flat at $5,500, with income deduction limits (below which the IRA contributions are tax deductible) rising in line with inflation. Simple IRA plan contribution limits stayed flat as well, though SEP IRA plans will see modest increases in the maximum compensation and contribution amounts.