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The IRS has released cost-of-living adjustments for the dollar limitations for pension plan contributions and other retirement-related items for tax year 2017.
The contribution limit for 401(k)s remains unchanged, at $18,000 for 2017. However, income ranges for eligibility to make deductible contributions to traditional IRAs and to Roth IRAs, and to claim the saver’s credit, all increased.
The phase-out ranges for when taxpayers or their spouses who were covered by a retirement plan at work were also changed for 2017:
- For single taxpayers covered by a workplace retirement plan — $62,000 to $72,000, up from $61,000 to $71,000.
- For married couples filing jointly where the spouse making the IRA contribution is covered by a workplace retirement plan — $99,000 to $119,000, up from $98,000 to $118,000.
- 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 $186,000 to $196,000, up from $184,000 and $194,000.
- 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 COLA and remains $0 to $10,000.
- The income phase-out range for taxpayers making contributions to a Roth IRA is $118,000 to $133,000 for singles and heads of household, up from $117,000 to $132,000. For married couples filing jointly, the income phase-out range is $186,000 to $196,000, up from $184,000 to $194,000.
- The phase-out range for a married individual filing a separate return who makes contributions to a Roth IRA is not subject to an annual COLA and remains $0 to $10,000.
- The income limit for the saver’s credit or the retirement savings contributions credit, for low- and moderate-income workers is $62,000; for married couples filing jointly is up from $61,500; $46,500; for heads of household, it is up from $46,125; and it is $31,000 for singles and married individuals filing separately, up from $30,750.
- The contribution limit for employees who participate in 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan remains unchanged at $18,000. The catch-up contribution limit for employees aged 50 and over who participate in those plans remains unchanged at $6,000.
The limit on annual contributions to an IRA remains unchanged at $5,500. The additional catch-up contribution limit for individuals aged 50 and over is not subject to an annual COLA and remains $1,000.
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