The IRS recently announced the 2018 cost-of-living adjustment (COLA) increases to contribution limits for IRAs and qualified plans.
Each year, the IRS adjusts these numbers for cost-of-living increases in $500 increments when statutory thresholds are met. Although there were no changes to traditional and Roth IRAs, we did see some increases for defined contribution limits (both elective salary deferral and employer contributions).
Below is a chart that compares the 2017 limits to the 2018 limits.
|Traditional and Roth IRA Contribution Limits||$5,500||$5,500||No Change|
|Traditional and Roth IRA Catch-Up Contributions||$1,000||$1,000||No Change|
|SIMPLE IRA Maximum Contributions||$12,500
|SIMPLE IRA Catch-Up Contributions
|SEP-IRA Contribution Limit||$54,000||$55,000||$1,000|
|401(k), 403(b), and 457(b) Maximum Elective Deferrals||$18,000||$18,500||$500|
|401(k), 403(b), and 457(b) Catch-Up Contributions||$6,000||$6,000||No Change|
|IRC 415 Defined Contribution Limits
For more information on the COLA changes, please visit the IRS website.
Should you have any questions regarding the increase in limits, please feel free to contact the Retirement Strategies Group at (800) 722-2333 or send an e-mail to RSG@PacificLife.com.
Pacific Life, its distributors, and respective representatives do not provide tax, accounting, or legal advice. Any taxpayer should seek advice based on the taxpayer's particular circumstances from an independent tax advisor or attorney.
Pacific Life is a product provider. It is not a fiduciary and therefore does not give advice or make recommendations regarding insurance or investment products.
Pacific Life refers to Pacific Life Insurance Company and its affiliates, including Pacific Life & Annuity Company. Insurance products are issued by Pacific Life Insurance Company in all states except New York and in New York by Pacific Life & Annuity Company. Product availability and features may vary by state. Each insurance company is solely responsible for the financial obligations accruing under the products it issues.
Variable insurance products are distributed by Pacific Select Distributors, LLC (member FINRA & SIPC), a subsidiary of Pacific Life Insurance Company (Newport Beach, CA) and an affiliate of Pacific Life & Annuity Company. Variable and fixed annuity products are available through licensed third parties.
No bank guarantee • Not a deposit • Not FDIC/NCUA insured • May lose value • Not insured by any federal government agency
For financial professional use only. Not for use with the public.