The Internal Revenue Service (IRS) today announced it was granting cost-of-living adjustments for employee pension plans for tax year 2015. As a result, the cap was raised to $18,000 from $17,500 a year for those participating in 401(k), 403(b) and 457 plans.
At the same time, the catch-up contribution limit for employees aged 50 and over participating in those plans, as well as those 50 or over participating in the federal government’s Thrift Savings Plan, was also increased $500 from $5,500 to $6,000.
The limit on annual contributions to an Individual Retirement Arrangement (IRA) remains unchanged at $5,500. The additional catch-up contribution limit for individuals aged 50 and over is not subject to an annual cost-of-living adjustment and remains at $1,000, the IRS announced.
Effective Jan. 1, 2015, the limitation on the annual benefit under a defined benefit plan under Section 415(b)(1)(A) remains unchanged at $210,000.