Jan 24, 2018
The IRS made a few cost of living adjustments to the retirement contribution limits for 2018. The 2018 limits are as follows:
- 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan - $18,500 (an increase of $500)
- 401(k) Catch-up - For employees age 50 or older, you can make the an additional $6,000 catch-up contribution, even if you turn 50 on December 31, 2018 (unchanged)
- SEP IRA and Solo 401(k) - $55,000, which is based on the amount you can contribute as an employer, as a percentage of your salary (an increase of $1,000)
- SIMPLE IRA - $12,500 (unchanged)
- SIMPLE IRA Catch-up - For employees age 50 or older, you can make the an additional $3,000 catch-up contribution, even if you turn 50 on December 31, 2018 (unchanged)
- Individual Retirement Accounts (IRA) - $5,500 (unchanged)
- IRA Catch-up - For contributors age 50 or older, you can make the an additional $1,000 catch-up contribution, even if you turn 50 on December 31, 2018 (unchanged)
- Roth IRA - $5,500 (unchanged)
- Roth IRA Catch-up - For contributors age 50 or older, you can make the an additional $1,000 catch-up contribution, even if you turn 50 on December 31, 2018 (unchanged)
If you earn too much to open a Roth IRA due to the IRS phase out rules, you can open a non-deductible IRA and convert it to a Roth IRA as congress lifted any income restrictions for Roth IRA conversions. To learn more about the “backdoor Roth”, please contact our office.
