Posts Tagged ‘New 401K Limit’

New Limits Allow Higher Contributions

Saturday, February 25th, 2012

New 401K LimitFor those focused on saving for retirement, the recent increase in the defined contribution plan limits are great news. For defined contribution plans like 401(k) and 403(b), the maximum employee deferral has increased by $500 this year to $17,000, (up from $16,500 in 2011).  The “catch-up” contribution for participants age 50 and older remains unchanged at $5,500 for tax year 2012.

IRA contribution limits

The annual contribution limits for individual retirement accounts (IRAs) remain unchanged. Individuals age 50 or older before the end of 2012 may contribute up to $6,000 to a traditional or Roth IRA. You can split contributions between a traditional and a Roth IRA, but the combined limit is $6,000. Note that your annual income determines eligibility for a Roth IRA. See irs.gov for additional details.

And don’t forget that there’s still time to make 2011 IRA contributions. You have until April 17, 2012!

Legal Disclaimer: This article is intended for informational purposes only and by no means should replace or substitute other legal documents (governmental or non-governmental) reflecting similar content or advice. If you have any questions concerning your situation or the information provided, please consult with an attorney, CPA or HR Professional.