The IRS recently released IRS Notice 2016-62 containing the limitations on benefits and compensation under qualified retirement plans. You can access a summary of the 2017 IRS Limits here. Note the following:
- The 401(k) Plan maximum elective deferral limit and catch-up contribution limit both stayed the same, at $18,000 and $6,000 respectively.
- The Defined Contribution Annual Additions Limit is increasing from $53,000 in 2016 ($59,000 with catch-up contributions) to $54,000 in 2017 ($60,000 with catch-up contributions).
- After staying at $210,000 from 2014 through 2016, the Defined Benefit Annual Benefits Limit is increasing to $215,000 in 2017. This will allow those who are bumping up against the limit to receive a larger lump sum from their Traditional Defined Benefit Plans and Cash Balance Plans.
- The qualified plan compensation limit is increasing from $265,000 to $270,000 in 2017.