Retirement Plan Limits for 2008

It does not look like 2008 is going to be a year of big changes for retirement plans. Let's look at what is changing and review what is going to stay the same.

New for 2008:

  • Maximum compensation which can be considered for retirement plan purposes is increasing from $225,000 to $230,000
  • The definition of a highly compensated employee is increasing to $105,000 from $100,000
  • The maximum defined benefit amount is increasing to $185,000 from $180,000
  • The maximum contribution to a retirement plan is increasing from $45,000 to $46,000.
  • Corporate officers will be able to earn up to $150,000 without being counted as a key employee (the 2007 limit is $145,000)
  • The taxable wage base for social security is increasing from $97,500 to $102,000
  • IRA contributions (both traditional and Roth) are increasing from $4000 to $5000

Stays the same:

  • Maximum elective salary deferrals remains $15,500 (this would be the 401(k), 403(b), and 457 limit)
  • SIMPLE plan maximum contributions remain $10,500
  • There is no change in the catch-up provisions for workers age 50 and older.

Change is Easy by dawn_perry

2 thoughts on “Retirement Plan Limits for 2008

  1. I actually think the change from $4K to $5K for IRAs is noteworthy, especially since it might slip back down to $2K in 2011. Definitely somewhere you should tuck your extra change if you can.

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