2011 Retirement Limits - Start Planning Now!!!
Posted on: 2/5/11 by
Kevin P. O'Leary, CPA
I know it's only February but thinking about retirement limits and retirement goals should be going on at all times. Here are the limits as they relate to 2011:
Defined Contribution/401(k) Plans:
- Max contribution is $16,500
- Max Compensation limit is $245,000
- Additional catch-up contributions if age 50 or older $5,500
- Defined contribution plans - contribution limited to $49,000 or 100% of compensation
- IRA contributions are limited to $5,000 with additional $1,000 contribution for people 50 and over.
- Anyone can make a contribution but contributions might not be deductible - if you are not covered by an employer's plan the income limitations are as follows: Single and head of households ($56k-$66k) married filing joint ($90k-$110k)
- If your spouse is a participant in a plan but you are not you are able to take a deduction, but the income phaseout is $169k-$179k.
ROTH IRA Accounts:
- Contribution amounts are the same as the IRA amounts above - obviously there is no deduction related to the ROTH because when you take the money out it comes out completely tax free!
- The income thresholds are a little different however - for single and head of households $107k-$122k) and for married filing joint ($169k - $179k).
- ROTHs are great vehicles because there is no required minimum distribution as there is with a traditional IRA - which means you never have to touch this account if you don't need to.
If you have a SEP or other retirement plan and have any questions please feel free to email me at anytime - especially this time of year I am always in the office!!!