• Safi Bello

How To Guide For: A Look At The New Pension Plan Limitations -- The 401(k) And IRA Rules And Other

On Thursday October 27 The Internal Revenue Service announced cost‑of‑living adjustments affecting dollar limitations for pension plans and other retirement-related items for tax year 2017. The IRS issued technical guidance detailing these items in Notice 2016-62. The income ranges for determining eligibility to make deductible contributions to traditional Individual Retirement Arrangements (IRAs), to contribute to Roth IRAs, and to claim the saver’s credit all increased for 2017. Taxpayers can deduct contributions to a traditional IRA if they meet certain conditions. If during the year either the taxpayer or their spouse was covered by a retirement plan at work, the deduction may be reduced, or phased out, until it is eliminated, depending on filing status and income. (If neither the taxpayer nor their spouse is covered by a retirement plan at work, the phase-outs of the deduction do not apply.) The income phase-out range for taxpayers making contributions to a Roth IRA is $118,000-$133,000 for singles and heads of household. For married couples filing jointly, the income phase-out range is $186,000-$196,000. The

phase-out range for a married individual filing a separate return who makes contributions to a Roth IRA is not subject to an annual cost-of-living adjustment and remains $0-$10,000.The income limit for the saver’s credit (also known as the retirement savings contributions credit) for low- and moderate-income workers is $62,000 for married couples filing jointly; $46,500 for heads of household; and $31,000 for singles and married individuals filing separately. Here are some of the items that will remain the same from 2016 1) The contribution limit for employees who participate in 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan remains unchanged at $18,000. 2) The catch-up contribution limit for employees aged 50 and over who participate in 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan remains unchanged at $6,000. 3) The limit on annual contributions to an IRA remains unchanged at $5,500. The additional catch-up contribution limit for individuals aged 50 and over is not subject to an annual cost-of-living adjustment and remains $1,000. To get more information on the new IRS 2017 Pension Plan limitations, 401(k) Contribution Limit, and IRA rules-- click the pictures below to read the articles.

In 2017, Some Tax Benefits Increase Slightly Due to Inflation Adjustments, Others Are Unchanged - Read More from the IRS
5 New 401(k) and IRA Rules for 2017 - Read More from U.S. News & World Report
IRS Announces 2017 Tax Rates, Standard Deductions, Exemption Amounts And More - Read More from Forbes
IRA and 401(k) Contribution Limits to Remain the Same in 2017 - Read More from Time
401(k), IRA contribution limits won't go up in 2017 - Read More from CNN

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