Honu Wealth Management
Garth A Williams, MBA, CFP®
Financial Advisor
1307 S Mary Ave, Suite 101
Sunnyvale, CA 94087
650-917-3400
garth@honuwealth.com
www.HonuWealth.com
 
 




2019 Key Numbers

 

Retirement Planning

Employee/individual contribution limits

Elective deferral limits20182019
401(k) plans, 403(b) plans, 457(b) plans, and SAR-SEPs 1 (Includes Roth 401(k) and Roth 403(b) contributions)Lesser of $18,500 or 100% of participant's compensation Lesser of $19,000 or 100% of participant's compensation
SIMPLE 401(k) plans and SIMPLE IRA plans1Lesser of $12,500 or 100% of participant's compensation Lesser of $13,000 or 100% of participant's compensation

1 Must aggregate employee contributions to all 401(k), 403(b), SAR-SEP, and SIMPLE plans of all employers. 457(b) plan contributions are not aggregated. For SAR-SEPs, the percentage limit is 25% of compensation reduced by elective deferrals (effectively, a 20% maximum contribution).

IRA contribution limits20182019
Traditional IRAsLesser of $5,500 or 100% of earned income Lesser of $6,000 or 100% of earned income
Roth IRAsLesser of $5,500 or 100% of earned income Lesser of $6,000 or 100% of earned income
Additional "catch-up" limits (individuals age 50 or older)20182019
401(k) plans, 403(b) plans, 457(b) plans, and SAR-SEPs2$6,000 $6,000
SIMPLE 401(k) plans and SIMPLE IRA plans$3,000$3,000
IRAs (traditional and Roth)$1,000$1,000

2 Special catch-up limits may also apply to 403(b) and 457(b) plan participants.

Employer contribution/benefit 3 limits

Defined benefit plan limits20182019
Annual contribution limit per participantNo predetermined limit. Contributions based on amount needed to fund promised benefitsNo predetermined limit. Contributions based on amount needed to fund promised benefits
Annual benefit limit per participantLesser of $220,000 or 100% of average compensation for highest three consecutive years Lesser of $225,000 or 100% of average compensation for highest three consecutive years
Defined contribution plan limits (qualified plans, 403(b) plans, SEP, and SIMPLE plans)20182019
Annual addition limit per participant (employer contributions; employee pretax, after-tax, and Roth contributions; and forfeitures) (does not apply to SIMPLE IRA plans)Lesser of $55,000 or 100% (25% for SEP) of participant's compensation Lesser of $56,000 or 100% (25% for SEP) of participant's compensation
Maximum tax-deductible employer contribution (not applicable to 403(b) plans)25% of total compensation of employees covered under the plan (20% if self employed) plus any employee pretax and Roth contributions; 100% for SIMPLE plans 25% of total compensation of employees covered under the plan (20% if self employed) plus any employee pretax and Roth contributions; 100% for SIMPLE plans

3 For self-employed individuals, compensation generally means earned income. This means that, for qualified plans, deductible contributions for a self-employed individual are limited to 20% of net earnings from self-employment (net profits minus self-employment tax deduction), and special rules apply in calculating the annual additions limit.

Compensation limits/thresholds

Retirement plan compensation limits20182019
Maximum compensation per participant that can be used to calculate tax-deductible employer contribution (qualified plans and SEPs)$275,000 $280,000
Compensation threshold used to determine a highly-compensated employee$120,000 (when 2018 is the look-back year) $125,000 (when 2019 is the look-back year)
Compensation threshold used to determine a key employee in a top-heavy plan$1 for more-than-5% owners $175,000 for officers $150,000 for more-than-1% owners$1 for more-than-5% owners $180,000 for officers $150,000 for more-than-1% owners
Compensation threshold used to determine a qualifying employee under a SIMPLE plan$5,000 $5,000
Compensation threshold used to determine a qualifying employee under a SEP plan$600 $600
Traditional deductible IRA income limits--Income phase-out range for determining deductibility of traditional IRA contributions for taxpayers covered by an employer-sponsored plan and filing as:20182019
Single$63,000 - $73,000 $64,000 - $74,000
Married filing jointly$101,000 - $121,000 $103,000 - $123,000
Married filing separately$0 - $10,000 $0 - $10,000
Traditional deductible IRA income limits--Income phase-out range for determining deductibility of traditional IRA contributions for taxpayers not covered by an employer-sponsored retirement plan but filing a:20182019
Joint return with a spouse who is covered by an employer-sponsored retirement plan$189,000 - $199,000 $193,000 - $203,000
Roth IRA compensation limits--Income phase-out range for determining ability to fund Roth IRA for taxpayers filing as:20182019
Single$120,000 - $135,000 $122,000 - $137,000
Married filing jointly$189,000 - $199,000 $193,000 - $203,000
Married filing separately$0 - $10,000 $0 - $10,000


This information was developed by Forefield, Inc. an independent third party. It is general in nature, is not a complete statement of all information necessary for making an investment decision, and is not a recommendation or a solicitation to buy or sell any security. Investments and strategies mentioned may not be suitable for all investors. Past performance may not be indicative of future results.

Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2018.