Springwater Wealth Management, LLC

  • Home
  • Who We Are
  • How We Help
  • Who We Serve
  • Resources
  • Contact Us
  • For Clients
  • Home
  • Who We Are
  • How We Help
  • Who We Serve
  • Resources
  • Contact Us
  • For Clients

The IRS has announced the 2018 retirement plan limits

Posted on October 27, 2017

The 2018 retirement plan limits have recently been announced by the IRS.

These new limits are effective January 1, 2018.

If you are an employee and a retirement plan participant, be sure to contact your employer as soon as possible if you wish to change your retirement plan salary deferrals for 2018. Of course, if you’re a Springwater client, we’re happy to assist!

If you are an employer and either don’t have a retirement plan in place or have questions about your existing one, please contact us for a complimentary tailor-made proposal and comparison with your current plan. You’ll have happier, more satisfied employees while also saving money.

401(k)s, 403(b)s, etc. The standard contribution limit for employee salary deferrals to a qualified retirement plan – 401(k), 403(b), most 457 plans, and the government’s Thrift Savings Plan – increases to $18,500 for 2018 (was $18,000 for 2017).

The “Catch-up”. The “catch-up” deferral limit for these plans remains at $6,000 (was $6,000 for 2017), so a person who is age 50 or older can defer a maximum of $24,500 in 2018.

Annual Defined Contribution Limit. The maximum “annual additions” limit (salary deferrals, plus profit sharing, plus forfeiture allocations, etc) to a defined contribution plan is increased to $55,000 for 2018 (from $54,000 for 2017). Note that the catch-up deferral is in addition to this, so the annual contribution limit for a person age 50 or older is $61,000.

SEP IRAs and Solo 401(k)s. The contribution limit for a SEP IRA or Solo 401(k) in 2018 is increased to the lesser of (a) $55,000, or (b) 25% of the employee’s salary. The compensation limit used in the savings calculation is increased to $275,000 for 2018 (was $270,000 for 2017).

IRAs. The contribution limits for Traditional and Roth IRAs remain at $5,500 for 2018; the catch-up contribution for a person age 50 or older remains at $1,000 in 2018, for a total of $6,500.

Simple IRAs. The contribution limit for a Simple IRA remains at $12,500 for 2018 (was $12,500 for 2017); the catch-up contribution for a person age 50 remains at $3,000 (was $3,000 for 2017), for a total of $15,500.

Defined Benefit Plans. Finally, the limitation on the annual benefit of a “defined benefit” plan in 2018 is $220,000, up from $215,000 for 2017.

Filed Under: Financial Planning, Investment Management, Retirement Plans, Retirement Plans, Services // Tagged: 401(k), 403(b), financial planning, investing, investment management, IRA, retirement, retirement plans, Roth IRA, SEP IRA

OUR LOCATIONS

Our Portland office is conveniently located off the SW Denney Road exit from Highway 217.

6600 SW 105th Avenue, Suite 155
Beaverton, OR 97008

Our Bay Area office is located in downtown Santa Cruz.

615 Water Street
Santa Cruz, CA 95060

Schedule a Free Consultation

If you'd like to learn more about how we can help you build a solid plan for your future, let us know by filling out our contact form. Or give us a call at (888) 998-4796.

Connect with Us

Want to keep up with the latest news from Springwater? Follow us across our social networks.
  • Facebook
  • Google+
  • LinkedIn
  • Twitter
  • YouTube
  • Disclosure
  • Privacy Policy
  • Fiduciary Commitment
  • Financial Links

© Copyright 2016 · Springwater Wealth Management, LLC · All Rights Reserved