2015 Retirement Plan Contribution Limits

For 2015, the IRS has announced cost-of-living adjustments that will result in increased contribution limits for most retirement plans. Let’s take a look at the changes for 2015 and see how they might affect your retirement and tax planning.

 

Employer Sponsored Plans including 401(k), 403(b), most 457 plans, & Federal Government Thrift Savings Plans

2015 Elective Contribution Limit:    $18,000

Eligible Catch-Up Contribution:       $6,000

Annual Contribution Limit:                Lesser of 100% of earnings or $53,000

What does this all mean? For 2015, the maximum an employee can elect to defer from their own earnings is $18,000 or $24,000 if you are 50 or older. The maximum annual contribution taking into consideration employee and employer contributions is the lesser of 100% of your earnings or $53,000.

Traditional and Roth IRAs

2015 Maximum Contribution:        $5,500*

Eligible Catch-Up Contribution:    $1,000

Individuals considering contributing to a Roth IRA, however, are subject to limits based on their Adjusted Gross Income. For example, a married couple filing a joint return can contribute the maximum to a Roth IRA if their adjusted gross income is under $183,000. Please consult your tax advisor for more information on Roth IRA contribution limits.

Additionally, there are phase-outs on the deductibility of traditional IRA contributions by individuals covered by an employer sponsored plan. Please consult your tax advisor for more information regarding these.

SEP IRAs

2015 Maximum Contribution:        $53,000

Like the 401(k), the maximum contribution for SEP IRAs is increased to $53,000 for 2015.

SIMPLE IRAs

2015 Maximum Contribution:        $12,500

Eligible Catch-Up Contribution:    $3,000

 

Planning for retirement should be considered in the context of your overall financial situation. This information should serve only as a guide for discussion and can’t be construed as tax or legal advice. Information is obtained from sources believed to be reliable, however, SquareOne Investments cannot be held liable for errors. Please consult your tax advisor for additional information.

 

Source: IRS Publication IR-201499

 

By Kevin McCauley

Principal - SquareOne Investments


Registered Representative. Securities offered through Cambridge Investment Research, Inc., a Broker/Dealer, Member FINRA/SIPC. Investment Advisor Representative, Cambridge Investment Research Advisors, Inc., a Registered Investment Advisor. SquareOne Investments and Cambridge are not affiliated