| | | Retirement Planning
Employee/individual contribution
limitsElective deferral
limits | 2023 | 2024 |
---|
401(k) plans, 403(b) plans, 457(b)
plans, and SAR-SEPs 1 [Includes Roth 401(k) and Roth 403(b)
contributions] | Lesser of $22,500 or 100% of participant's compensation | Lesser of $23,000 or 100% of participant's compensation | SIMPLE 401(k) plans and SIMPLE IRA
plans1 | Lesser of $15,500 or 100% of participant's compensation | Lesser of $16,000 or 100% of participant's compensation |
1 Must aggregate employee contributions to all 401(k),
403(b), SAR-SEP, and SIMPLE plans of all employers. 457(b) plan contributions
are not aggregated. For SAR-SEPs, the percentage limit is 25% of compensation
reduced by elective deferrals (effectively, a 20% maximum contribution). IRA contribution
limits | 2023 | 2024 |
---|
Traditional IRAs | Lesser of $6,500 or 100% of earned income
| Lesser of $7,000 or 100% of earned income
| Roth IRAs | Lesser of $6,500 or 100% of earned income
| Lesser of $7,000 or 100% of earned income
|
Additional "catch-up" limits
(individuals age 50 or older) | 2023 | 2024 |
---|
401(k) plans, 403(b) plans, 457(b)
plans, and SAR-SEPs2 | $7,500
| $7,500 | SIMPLE 401(k) plans and SIMPLE IRA
plans | $3,500 | $3,500 | IRAs (traditional and
Roth) | $1,000 | $1,000 |
2 Special catch-up limits may also apply to 403(b) and
457(b) plan participants.
Employer contribution/benefit 3 limitsDefined benefit plan
limits | 2023 | 2024 |
---|
Annual contribution limit per
participant | No predetermined limit. Contributions based on amount
needed to fund promised benefits | No predetermined limit. Contributions based on amount needed to fund promised benefits. | Annual benefit limit per
participant | Lesser of $265,000 or 100% of average compensation for highest three consecutive years
| Lesser of $275,000 or 100% of average compensation for highest three consecutive years |
Defined contribution
plan limits [qualified plans, 403(b) plans, SEP, and SIMPLE plans] | 2023 | 2024 |
---|
Annual addition limit per participant
(employer contributions; employee pre-tax, after-tax, and Roth contributions;
and forfeitures) (does not apply to SIMPLE IRA plans) | Lesser of $66,000 or 100% (25% for SEP) of participant's compensation
| Lesser of $69,000 or 100% (25% for SEP) of participant's compensation | Maximum tax-deductible employer
contribution [not applicable to 403(b) plans] | 25% of total compensation of employees covered under the plan (20% if self employed) plus any employee pre-tax and Roth contributions; 100% for SIMPLE plans
| 25% of total compensation of employees covered under the plan (20% if self employed) plus any employee pre-tax and Roth contributions; 100% for SIMPLE plans |
3 For self-employed individuals, compensation generally
means earned income. This means that, for qualified plans, deductible
contributions for a self-employed individual are limited to 20% of net earnings
from self-employment (net profits minus self-employment tax deduction), and
special rules apply in calculating the annual additions limit. Compensation
limits/thresholds
Retirement plan compensation
limits | 2023 | 2024 |
---|
Maximum compensation per participant
that can be used to calculate tax-deductible employer contribution (qualified
plans and SEPs) | $330,000
| $345,000 | Compensation threshold used to
determine a highly compensated employee | $150,000 (when 2023 is the look-back year)
| $155,000 (when 2024 is the look-back year) | Compensation threshold used to
determine a key employee in a top-heavy plan | $1 for more-than-5% owners,
$215,000 for officers,
$150,000 for more-than-1% owners
| $1 for more-than-5% owners,
$220,000 for officers,
$150,000 for more-than-1% owners | Compensation threshold used to
determine a qualifying employee under a SIMPLE
plan | $5,000
| $5,000 | Compensation threshold used to
determine a qualifying employee under a SEP plan | $750 | $750 |
Traditional deductible IRA income
limits — Income phase-out range for determining
deductibility of traditional IRA contributions for
taxpayers covered by an employer-sponsored
plan and filing as: | 2023 | 2024 |
---|
Single | $73,000 - $83,000 | $77,000 - $87,000 | Married filing jointly | $116,000 - $136,000
| $123,000 - $143,000 | Married filing separately | $0 - $10,000
| $0 - $10,000 |
Traditional deductible IRA income
limits — Income phase-out range for determining
deductibility of traditional IRA contributions for
taxpayers not covered by an employer-sponsored
retirement plan but filing a: | 2023 | 2024 |
---|
Joint return with a spouse who is covered by an
employer-sponsored retirement plan | $218,000 - $228,000
| $230,000 - $240,000 |
Roth IRA compensation
limits — Income phase-out range for determining
ability to fund Roth IRA for taxpayers filing as: | 2023 | 2024 |
---|
Single | $138,000 - $153,000 | $146,000 - $161,000 | Married filing jointly | $218,000 - $228,000 | $230,000 - $240,000 | Married filing separately | $0 - $10,000
| $0 - $10,000 |
Qualified charitable distribution
| 2023 | 2024 |
---|
Annual amount not includible in gross income | $100,000 | $105,000 | One-time exclusion for transfer to split-interest entity | $50,000 | $53,000 |
| | | | The information contained herein is based on sources believed to be reliable, but its accuracy cannot be guaranteed. The articles, information, calculators, and opinions presented herein are for general information only and are not intended to provide specific advice or recommendations for any individual. New Capital Management does not provide tax, accounting, or legal advice. All decisions regarding the tax or legal implications of your investments and finances should be made with your tax or legal advisor. New Capital Management is not a bank, mortgage lender, or broker. Nothing herein should be construed as an offer or commitment to lend. Any calculations are provided as educational tools, are hypothetical in nature, depend wholly on information you provide, do not assume the effects of all pertinent factors, and are not intended to provide investment advice or serve as a financial plan.
This communication is strictly intended for individuals residing in the state(s) of TX. No offers may be made or accepted from any resident outside the specific states referenced. | Prepared by Broadridge Advisor Solutions Copyright 2024. | | |