Industry Update: IRS Limits Adjustments for 2018
Written by CUNA Mutual Group Annuities
The Internal Revenue Service announced its changes to retirement plan contribution and Social Security limits for 20181.These numbers don’t necessarily change annually, so being aware of this year’s tax-adjusted figures could impact how you guide your clients in their financial decisions.
Retirement Contribution Limits
Several of the retirement plan categories experienced slight contribution increases for 2018, as reflected in the following table.
It’s important to note that one contribution limit that remained the same year over year is the 401(k) catch up. As in 2017, the maximum amount participants age 50 or older can earmark for catch up is capped at $6,000 for 20182.
Social Security Limits
For those clients collecting Social Security, you may want to alert them to the 2018 changes to the retirement earnings test exempt amounts, as determined using procedures defined in the Social Security Act3:
Learn more about helping your clients possibly strengthen their financial strategies and position in Risk Control Accounts: Limiting the Downside, Providing Opportunity for Higher Returns (Opens in a new window).
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2 https://www.forbes.com/sites/ashleaebeling/2017/10/19/irs-announces-2018-retirement-plan-contribution-limits-for-401ks-and-more/#47e0878525ac(Opens in a new window)
3 https://www.ssa.gov/oact/cola/rtea.html (Opens in a new window)