IRS Announces 2019 Retirement Plan Limits

IRS Limits on Retirement Benefits and Compensation

As published in IRS News Release IR-2018-83, Nov. 1, 2018

  2019 2018 2017
401(k), 403(b), 457 Elective Deferral Limit $19,000 $18,500 $18,000
Catch-Up Contribution Limit (age 50 and older) $6,000 $6,000 $6,000
Annual Compensation Limit $280,000 $275,000 $270,000
Defined Contribution Limit $56,000 $55,000 $54,000
Defined Benefit Limit $225,000 $220,000 $215,000
Definition of Highly Compensated Employee $125,000 $120,000 $120,000
Key Employee $180,000 $175,000 $175,000
IRA Contribution Limit $6,000 $5,500 $5,500
IRA Catch-Up Contributions (age 50 and older) 1,000 1,000 1,000

For more information about retirement plan limits, please contact your plan advisor, or click here.

Highlights of changes for 2019

The contribution limit for employees who participate in 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan is increased from $18,500 to $19,000.

The income ranges for determining eligibility to make deductible contributions to traditional Individual Retirement Arrangements (IRAs), to contribute to Roth IRAs and to claim the saver’s credit all increased for 2019.

Taxpayers can deduct contributions to a traditional IRA if they meet certain conditions. If during the year either the taxpayer or their spouse was covered by a retirement plan at work, the deduction may be reduced, or phased out, until it is eliminated, depending on filing status and income. (If neither the taxpayer nor their spouse is covered by a retirement plan at work, the phase-outs of the deduction do not apply.) Here are the phase-out ranges for 2019:

  • For single taxpayers covered by a workplace retirement plan, the phase-out range is $64,000 to $74,000, up from $63,000 to $73,000.
  • For married couples filing jointly, where the spouse making the IRA contribution is covered by a workplace retirement plan, the phase-out range is $103,000 to $123,000, up from $101,000 to $121,000.
  • For an IRA contributor who is not covered by a workplace retirement plan and is married to someone who is covered, the deduction is phased out if the couple’s income is between $193,000 and $203,000, up from $189,000 and $199,000.
  • For a married individual filing a separate return who is covered by a workplace retirement plan, the phase-out range is not subject to an annual cost-of-living adjustment and remains $0 to $10,000.

The income phase-out range for taxpayers making contributions to a Roth IRA is $122,000 to $137,000 for singles and heads of household, up from $120,000 to $135,000. For married couples filing jointly, the income phase-out range is $193,000 to $203,000, up from $189,000 to $199,000. The phase-out range for a married individual filing a separate return who makes contributions to a Roth IRA is not subject to an annual cost-of-living adjustment and remains $0 to $10,000.

The income limit for the Saver’s Credit (also known as the Retirement Savings Contributions Credit) for low- and moderate-income workers is $64,000 for married couples filing jointly, up from $63,000; $48,000 for heads of household, up from $47,250; and $32,000 for singles and married individuals filing separately, up from $31,500.

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