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Annual Limits

2017

  • Compensation limit under Sections 401(a)(17), 404(l), 408(k)(3)(C), 408(k)(6)(D)(ii): 270,000
  • Elective deferral limit for 401(k), 403(b) and 457(b) plans: 18,000
  • Catch-up limit for 401(k), 403(b) and 457(b) plans: 6,000
  • Benefit limitation for Defined Benefit Plans under section 415(b)(1)(A): 215,000
  • Limitation for Defined Contribution Plans under section 415(c)(1)(A): 54,000
  • Elective deferral limit for SIMPLE 401(k) under Section 408(p)(2)(E): 12,500
  • Catch-up limit for SIMPLE 401(k) plans: 3,000


2016
  • Compensation limit under Sections 401(a)(17), 404(l), 408(k)(3)(C), 408(k)(6)(D)(ii): 265,000
  • Elective deferral limit for 401(k), 403(b) and 457(b) plans: 18,000
  • Catch-up limit for 401(k), 403(b) and 457(b) plans: 6,000
  • Benefit limitation for Defined Benefit Plans under section 415(b)(1)(A): 210,000
  • Limitation for Defined Contribution Plans under section 415(c)(1)(A): 53,000
  • Elective deferral limit for SIMPLE 401(k) under Section 408(p)(2)(E): 12,500
  • Catch-up limit for SIMPLE 401(k) plans: 3,000


2015
  • Compensation limit under Sections 401(a)(17), 404(l), 408(k)(3)(C), 408(k)(6)(D)(ii): 265,000
  • Elective deferral limit for 401(k), 403(b) and 457(b) plans: 18,000
  • Catch-up limit for 401(k), 403(b) and 457(b) plans: 6,000
  • Benefit limitation for Defined Benefit Plans under section 415(b)(1)(A): 210,000
  • Limitation for Defined Contribution Plans under section 415(c)(1)(A): 53,000
  • Elective deferral limit for SIMPLE 401(k) under Section 408(p)(2)(E): 12,500
  • Catch-up limit for SIMPLE 401(k) plans: 3,000


2013

  • Compensation limit under Sections 401(a)(17), 404(l), 408(k)(3)(C), 408(k)(6)(D)(ii): 255,000
  • Elective deferral limit for 401(k), 403(b) and 457(b) plans: 17,500
  • Catch-up limit for 401(k), 403(b) and 457(b) plans: 5,500
  • Benefit limitation for Defined Benefit Plans under section 415(b)(1)(A): 205,000
  • Limitation for Defined Contribution Plans under section 415(c)(1)(A): 51,000
  • Elective deferral limit for SIMPLE 401(k) under Section 408(p)(2)(E): 12,000
  • Catch-up limit for SIMPLE 401(k) plans: 2,500

2012
  • Compensation limit under Sections 401(a)(17), 404(l), 408(k)(3)(C), 408(k)(6)(D)(ii): 250,000
  • Elective deferral limit for 401(k), 403(b) and 457(b) plans: 17,000
  • Catch-up limit for 401(k), 403(b) and 457(b) plans: 5,500
  • Benefit limitation for Defined Benefit Plans under section 415(b)(1)(A): 200,000
  • Limitation for Defined Contribution Plans under section 415(c)(1)(A): 50,000
  • Elective deferral limit for SIMPLE 401(k) under Section 408(p)(2)(E): 11,500
  • Catch-up limit for SIMPLE 401(k) plans: 2,500


2011

  • Compensation limit under Sections 401(a)(17), 404(l), 408(k)(3)(C), 408(k)(6)(D)(ii): $245,000
  • Elective deferral limit for 401(k), 403(b) and 457(b) plans: $16,500
  • Catch-up limit for 401(k), 403(b) and 457(b) plans: $5,500
  • Benefit limitation for Defined Benefit Plans under section 415(b)(1)(A): $195,000
  • Limitation for Defined Contribution Plans under section 415(c)(1)(A): $49,000
  • Elective deferral limit for SIMPLE 401(k) under Section 408(p)(2)(E): $11,500
  • Catch-up limit for SIMPLE 401(k) plans: $2,500


2010

  • Compensation limit under Sections 401(a)(17), 404(l), 408(k)(3)(C), 408(k)(6)(D)(ii): $245,000
  • Elective deferral limit for 401(k), 403(b) and 457(b) plans: $16,500
  • Catch-up limit for 401(k), 403(b) and 457(b) plans: $5,500
  • Benefit limitation for Defined Benefit Plans under section 415(b)(1)(A): $195,000
  • Limitation for Defined Contribution Plans under section 415(c)(1)(A): $49,000
  • Elective deferral limit for SIMPLE 401(k) under Section 408(p)(2)(E): $11,500
  • Catch-up limit for SIMPLE 401(k) plans: $2,500


ERISA Fidelity Bonds
An ERISA fidelity bond protect the participants and beneficiaries in a retirement plan from fraud or dishonest acts on the part of the fiduciary and other selected employees. This type of bond can be purchased from most insurance companies. The amount of coverage should be no less than 10% of the plan assets with a minimum of a 1,000 bond up to a maximum required bond of 500,000.

To begin the process of purchasing a Fidelity Bond, click here: www.colonialsurety.com

The Importance of Depositing Employee Deferrals Timely
The Department of Labor issued some long-awaited guidance on the deadline for depositing elective deferrals to a retirement plan. The general rule that had allowed plan sponsors to deposit employee elective deferrals to the plan as soon as could be reasonably segregated from the employer’s general assets left concern that the later employers waited to make deposits to the plan, the more likely they would not be made at all. It is still suggested by the DOL that employee deferrals be deposited as soon as administratively feasible. However, the DOL will not consider these deposits late if deposited by the 7th business day after following the day that amounts would have been payable to the participant in cash.

Change in Cafeteria Reimbursements Regarding Medicines or Drugs
Effective January 1, 2011, a payment or request for reimbursement for a medicine or a drug is a tax-free qualified medical expense only if (1) it is a medicine or drug that requires a prescription, (2) it is an over-the-counter medicine or drug and the individual obtains a prescription, or (3) it is insulin.

If amounts are distributed for any medicine or drug that does not satisfy this requirement, the amounts will be distributions for nonqualified medical expenses, which are includible in gross income and generally subject to a 20% additional tax. This change does not affect distributions for medicines or drugs made before January 1, 2011, nor does it affect distributions made after December 31, 2010, for medicines or drugs purchased on or before that date.”

The Importance of Investment Diversification
To help achieve long-term retirement security, you should give careful consideration to the benefits of a well-balanced and diversified investment portfolio. Spreading your plan assets among different types of investments can help you achieve a favorable rate of return while minimizing your overall risk of losing money. Market or other economic conditions that cause one category of assets, or one particular security, to perform very well often cause another asset category, or another particular security, to perform poorly. If you invest more than 20% of your retirement savings in any one company or industry, your savings may not be properly diversified. Although diversification is not a guarantee against loss, it is an effective strategy to help you manage investment risk. In deciding how to invest your retirement savings, you should take into account all of your assets, including any retirement savings outside of the Plan. No single approach is right for everyone because, among other factors, individuals have different financial goals, different time horizons for meeting their goals, and different tolerances for risk. It is also important to periodically review your investment portfolio, your investment objectives, and the investment options under then Plan to help ensure that your retirement savings will meet your retirement goals. For more information on individual investing and diversification, visit the Department of Labor Web site: http://www.dol.gov/ebsa/investing.html

 

...We're Thinking Forward