The limitation on the exclusion for elective deferrals described in IRS Section 402(g)(3) – for 401(k) type plans and Section 457 plans increases to $16,500 for 2009. The limit for 2008 was $15,500.
Other pension plan limit amount changes are as follows:
- Defined contributions plans under section 415(c )(1)(A) increases to $49,000
- The general definition of a highly compensated employee increases to $110,000
- The definition of a key employee in a “top-heavy plan” increases to $160,000
- IRS also indicates the limited compensation amount under Treasury Regulations and Internal Revenue Code Section 1.61-21(f)(5)(iii) will increase to $195,000
- The general annual compensation limit will increase to $245,000
Other Pension Plan increases for 2009:
- The compensation amount under the regulations defining control employees for fringe benefit valuation purposes increases to $95,000
- The compensation amount regarding simplified employee pensions (SEPs) increases to $550
- The annual SIMPLE retirement account limitation increases to $11,500
The IRS also announced the additional “catch-up” contribution allowed individuals age 50 and over participating in a qualified plan increases to $5,500.
For further information visit www.irs.gov and visit the Newsroom section.