IRS Announces Cost of Living Adjustment (COLA) Limits for 2013 Applicable to Retirement Plans
The Internal Revenue Service has announced cost of living adjustments (COLA) applicable to dollar limitations for retirement plans for 2013.
Employers should make sure that the individuals in charge of their payroll systems and relevant communication materials are updated and plan administration is aware of these limits.
|Maximum annual compensation that may be taken into acount for determinig benefits or contributions||$255,000||$250,000|
|Maximum 401 (k) and 403 (b) deferral contribution limit||$17,500||$17,000|
|Maximum 457 (b) deferral contribution limit||$17,500||$17,000|
|Maximum 401 (k) and 403 (b) and governmental 457 (b) catch-up contribution limit for participants age 50 or older||$5,500||$5,500|
|Defined contribution maximum annual addition||$51,000||$50,000|
|Defined benefit maximum annual benefit||$200,000||$195,000|
|Key employee top-heavy plan||$165,000||$165,000|
|Highly compensated employee compensation threshold||$115,000||$115,000|
|Maximum SIMPLE Retirement Account contribution limit||$12,000||$11,500|
|Social Security taxable wage base (FICA)||$113,700||$110,100|
More information on the new COLA limits can be found by visiting the IRS website at http://www.irs.gov/Retirement-Plans