IRA and Retirement Plan Limits for 2014

12 Mar

Due to low inflation there were only a few changes to retirement plan contributions for 2014. A summary of the most common limits are:

  • Salary deferral limit for 401ks remains at $17,500.
  • The catchup amount for 401ks remains at $5,500 allowing over 50 year old clients to contribute $23,000.
  • The maximum contribution to IRAs and Roth IRAs remains at $5,500 plus a $1,000 catchup over age 50.
  • The limit for defined contribution plans (combined employee and employer) is increased from $51,000 to $52,000 plus a $5,500 catchup over age 50.
  • The deduction for taxpayers making contributions to a traditional IRA is phased out for singles and heads of household who are covered by a workplace retirement plan and have modified adjusted gross incomes (AGI) between $60,000 and $70,000, up from $59,000 and $69,000 in 2013. For married couples filing jointly, in which the spouse who makes the IRA contribution is covered by a workplace retirement plan, the income phase-out range is $96,000 to $116,000, up from $95,000 to $115,000. For an IRA contributor who is not covered by a workplace retirement plan and is married to someone who is covered, the deduction is phased out if the couple’s income is between $181,000 and $191,000, up from $178,000 and $188,000. For a married individual filing a separate return who is covered by a workplace retirement plan, the phase-out range is not subject to an annual cost-of-living adjustment and remains $0 to $10,000.
  • The AGI phase-out range for taxpayers making contributions to a Roth IRA is $181,000 to $191,000 for married couples filing jointly, up from $178,000 to $188,000 in 2013. For singles and heads of household, the income phase-out range is $114,000 to $129,000, up from $112,000 to $127,000. For a married individual filing a separate return, the phase-out range is not subject to an annual cost-of-living adjustment and remains $0 to $10,000.
  • The AGI limit for the saver’s credit (also known as the retirement savings contribution credit) for low- and moderate-income workers is $60,000 for married couples filing jointly, up from $59,000 in 2013; $45,000 for heads of household, up from $44,250; and $30,000 for married individuals filing separately and for singles, up from $29,500.

If you have any questions or need any assistance in setting up accounts, maximizing contributions or optimizing investments please call: (269)441-4090

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