Do you have a retirement plan for your employees? Here are the contribution limits for the 2019 tax year to be aware of:
For defined contribution plans—such as 401(k), 403(b) and 457 plans—the contribution limits have increased to $19,000, up $500 from last year.
The catch-up contribution limit remains at an additional $6,000 for participants at least age 50. Total contributions by an employee and employer rise from $55,000 to $56,000. SEP-IRAs, profit sharing and money purchase plans have the same limit increase to $56,000.
The elective contribution limit for a Simple IRA rises to $13,000, with employer non-elective contributions capped at 2% of compensation up to $280,000, up from $275,000. The $3,000 catch-up contribution remains the same.
The contribution limit for defined benefit pension plans increases to $225,000 from $220,000. For tax year 2019, HSA contributions have also increased again. Employees can contribute up to $2,700 into their health flexible spending accounts. Social Security income limits may require an adjustment on your part, too.
The Social Security wage base is now up to $132,900 for 2019, up from $128,400. Ask us if you have any other questions specific to you including salary and compensation limitations, which aren’t described here.
Source: ClientLine Newsletter.
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