Retirement Account Limits for 2018

While there is a lot of focus on the proposed tax law changes that have a target effective date of 2018, there is something we can count on for 2018, the inflation adjusted retirement account limits. There are currently no proposed changes to the following limits.

IRAs

The IRA/Roth IRA contribution limit remains unchanged at $5,500 with a $1,000 catch-up amount for those who are age 50 or older in 2018. The income limits for deductibility have increased. For single taxpayers covered by an employer sponsored retirement plan, the ability to deduct an IRA contribution phases out between $63,000 and $73,000; for those married filing jointly the phase-out range is $101,000 and $121,000; and for those who are not covered by an employer sponsored retirement plan, but are married to an active participant, the phase-out range is $189,000 and $199,000.

The income limits for making Roth IRA contributions are increased. The ability to make a Roth contribution for a couple filing a joint return will be phased out at $189,000 to $199,000 and for singles the phase-out range becomes $120,000 to $135,000.

The contribution limits for SEP IRAs have increased. The maximum SEP contribution is 25% of compensation up to $275,000 capped at $55,000.

The deferral limit for SIMPLE IRAs remains unchanged at $12,500 and the catch-up limit also remains unchanged at $3,000.

Employer Plans

The total contribution limit to an employer plan is increased to $55,000, the deferral limit is increased to $18,500, and the catch-up limit remains $6,000.

QLAC Limits

The limit for qualifying longevity annuity contracts (QLACs) is increased to $130,000. This limit applies to both IRAs and employer plans.