Wipfli Alerts & Updates: Updated Employee Benefit Plan and IRA Quick Reference Table 2011 & 2012


November 3, 2011
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The Internal Revenue Service has announced the cost-of-living adjustments applicable to dollar limitations for various qualified retirement plans and other amounts for 2012. For the first time in the last three years, most of the figures published will increase. Plan sponsors should verify that their administrative and payroll systems reflect the appropriate limits. Communications that specify benefit plan limits should be reviewed for accuracy before materials are given to participants.

 
2012
2011
Compensation limit—IRC Sec. 401(a)(17)
$250,000
 $245,000
Defined benefit plan annual benefit limit
$200,000
 $195,000
Defined contribution plan annual contribution limit
 $50,000
 $49,000
401(k), 403(b), and SARSEPs
 
 
Annual deferral limit(2)
 $17,000
 $16,500
Catch-up contribution(3)
 $5,500
 $5,500
457 Plan
 
 
Annual deferral limit(2)
 $17,000
 $16,500
Catch-up contribution(3)
 $5,500
 $5,500
SIMPLE Plan
 
 
Annual deferral limit(2)
 $11,500
 $11,500
Catch-up contribution(3)
 $2,500
 $2,500
IRA
 
 
Annual deferral limit(2)
 $5,000
 $5,000
Catch-up contribution(3)
 $1,000
 $1,000
Highly compensated employee compensation threshold
 $115,000
 $110,000
Key employee officer compensation threshold
 $165,000
 $160,000
SEP compensation threshold
 $550
 $550
Traditional IRA deduction phaseout (AGI)
 
 
Unmarried—active participant
$58,000/$68,000
$56,000/$66,000
MFS—any spouse participates
$0/$10,000
$0/$10,000
MFJ—nonparticipating spouse
$173,000/$183,000
$169,000/$179,000
MFJ—participating spouse
$92,000/$112,000
$90,000/$110,000
Social Security tax wage base
 $110,100
 $106,800
Roth IRA contribution eligibility (AGI)
 
 
Joint return
$173,000/$183,000
$169,000/$179,000
Single and HOH
$110,000/$125,000
$107,000/$122,000
MFS—any spouse participates
$0/$10,000
$0/$10,000
Eligibility for rollover to Roth IRA (AGI)
 
 
Joint return, single, and HOH
Allowed(4)
Allowed(4)
MFS
Allowed(4)
Allowed(4)

 

 

(1) This table has been updated based on IRS Announcement IR-2001-103, October 20, 2011.

(2) This applies to the total of all elective deferrals an individual makes for the year to 401(k) plans, 403(b) plans, SARSEPs, and SIMPLE plans. However, deferrals to each SIMPLE plan in which the individual participates are also limited, as shown later in the table.
(3) Catch-up contributions are available each year to individuals who reach age 50 by the end of the year.
(4) Effective for years beginning after 2009, there is no AGI limit for Roth rollovers.  Also, MFS taxpayers are allowed to make Roth IRA rollovers.

If you have any questions, or for more information about the 2012 cost-of-living adjustments for retirement plans, please contact Pamela Branshaw, Thomas Krieg, Robert Buss, or your Wipfli relationship executive.

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