The Internal Revenue Service (IRS) has announced contribution limits for retirement plan participants for 2015. Many of the limits will change because the Consumer Price Index met the statutory thresholds that trigger their adjustment.
The maximum annual contribution employees can make through salary reduction to a 401(k), 457(b), or 403(b) has increased to $18,000. Catch-up contributions for employees 50 years of age and older has also increased, to a maximum of $6,000 per year. SIMPLE IRA limits have increased from $12,000 to $12,500, while the compensation limit for SEPs has also increased from $550 to $600.
The dollar limit used in the definition of a key employee for top-heavy purposes remains unchanged at $170,000, but the definition of a highly compensated employee has increased to $120,000.