The 2017 retirement plan contribution limits have been announced and not much has changed since 2016. Below are the key points about what you need to know in regards to the 2017 retirement plan contribution limits set forth by the IRS. Please note that limits apply to self-directed retirement plans as well as those that are not self-directed.
- Roth and traditional IRA contribution limits remain the same. For 2016 and 2017, individuals can contribute $5,500 for a traditional or Roth IRA; the catch-up limit for ages 50 or older is an extra $1,000.
- SIMPLE IRA contribution limits have also remained the same. For 2016 and 2017, the employee salary deferral contribution limit is $12,500; ages 50 and older can contribute an extra $3,000.
- SEP IRA contribution limits have increased. In 2016 the contribution limit for SEP IRAs was $53,000 or 25% of compensation. For 2017 the limit increased $1,000 to $54,000 or 25% of compensation.
- Total combined contribution for 401(k)/profit-sharing plans has increased by $1,000. Salary deferral plus profit sharing match for ages 50 and under was $53,000 in 2016, and has increased in 2017 to $54,000. Participants ages 50 or older could contribute $59,000 in 2016 for their total combined contribution and in 2017 that amount has increased to $60,000.
- Health savings account (HSA) contribution limits for an individual has increased from $3,350 in 2016 to $3,400 in 2017.
- Educational savings account (ESA) contribution limits remains the same for 2016 and 2017 at $2,000.
Retirement plan holders can still make a 2016 contribution (if eligible) until April 17, 2017. 2017 contributions can be made anytime between now and April 16, 2018. Knowing the annual contribution limits helps savvy investors budget and plan to max their contributions out every year and to avoid exceeding the limits, which can spell big trouble with the IRS.
If you are a client of Midland IRA, contact Midland IRA at (877) 944-5472 to make a contribution for 2016 or 2017. You may also view the full contribution limits chart on our website at https://www.midlandira.com/contribution-limits/.