Pension Plan Limits 2010
The Internal Revenue Service announced on October 15, 2009, the cost-of-living adjustments applicable to dollar limitations for pension plans and other items for Tax Year 2010.
The limitations that are adjusted by reference to Section 415(d) will remain unchanged for 2010. This is because the cost-of-living index for the quarter ended September 30, 2009, is less than the cost-of-living index for the quarter ended September 30, 2008, and, following the procedures under the Social Security Act for adjusting benefit amounts, any decline in the applicable index cannot result in a reduced limitation.
Other 2009-2010 Pension Plan Adjustments:
|
2008 |
2009 |
2010 |
Elective Deferrals |
$15,500 |
$16,500 |
$16,500 |
Age 50 Catch Up* |
$5,000 |
$5,500 |
$5,500 |
Limit on Defined Benefit Plan |
$185,000 |
$195,000 |
$195,000 |
Limit on Defined Contribution Plan |
$46,000 |
$49,000 |
$49,000 |
Limit on Covered Compensation |
$230,000 |
$245,000 |
$245,000 |
Highly Comp. Employee |
$105,000 |
$110,000 |
$110,000 |
Maximum IRA Contribution |
$5,000 |
$5,000 |
$5,000 |
Age 50 Catch Up |
$1,000 |
$1,000 |
$1,000 |
Deductible IRA
Phase Out ** |
$85,000 - $105,000 MFJ
$53,000 - $63,000 Single |
$89,000 - $109,000 MFJ
$55,000 - $65,000 Single |
$89,000 - $109,000 MFJ
$56,000 - $66,000 Single
|
Deductible IRA Phase Out Spouse*** |
$159,000 - $169,000 |
$166,000 - $176,000 |
$167,000 - $177,000 |
Roth IRA Phase Out**** |
$159,000 - $169,000 MFJ
$101,000 - $116,000 Single
$100,000 Rollover |
$166,000 - $176,000 MFJ
$105,000 - $120,000 Single
$100,000 Rollover |
$167,000 - $177,000 MFJ
$105,000 - $120,000 Single
No Rollover Limit
|
IRA Credit 50% Limitation***** |
$0 - $32,000 MFJ
$0 - $24,000 HOH
$0 - $16,000 Single |
$0 - $33,000 MFJ
$0 - $24,750 HOH
$0 - $16,500 Single |
$0 - $33,500 MFJ
$0 - $25,125 HOH
$0 - $16,750 Single
|
IRA Credit 20% Limitation |
$32,001 - $34,500 MFJ
$24,001 - $25,875 HOH
$16,001 - $17,250 Single |
$33,001 - $36,000 MFJ
$24,751 - $27,000 HOH
$16,501 - $18,000 Single |
$33,501 - $36,000 MFJ
$25,125 - $27,000 HOH
$16,751 - $18,000 Single
|
IRA Credit 10% Limitation |
$34,501 - $53,000 MFJ
$25,876 - $39,750 HOH
$17,251 - $26,500 Single |
$36,001 - $55,500 MFJ
$27,001 - $41,625 HOH
$18,000 - $27,750 Single |
$36,001 - $55,500 MFJ
$27,001 - $41,625 HOH
$18,000 - $27,750 Single
|
Pension Plan Startup Costs Credit |
$500 Credit (50% of Costs) First 3 years of plan less than 100 employees |
$500 Credit (50% of Costs) First 3 years of plan less than 100 employees |
$500 Credit (50% of Costs) First 3 years of plan less than 100 employees |
Maximum Earnings Subject to SS |
$102,000 |
$106,800 |
$106,800 |
SS Earnings Required for Credit |
$1,050/QTR |
$1,090/QTR |
$1,120/QTR |
Retirement Earnings Exempt Under FR****** |
$1,130/MO |
$1,180/MO |
$1,180/MO |
Retirement Earnings Exempt Over FR******* |
$3,010/MO |
$3,140/MO |
$3,140/MO |
Maximum SS |
$2,185/MO |
$2,323/MO |
$2,346/MO |
* If the individual has attained the age of 50 before the close of the taxable year
** If both spouses are covered by a pension plan
*** If only one spouse is covered by a pension plan
**** Starting after 12/31/2009, there will be no income limitations to rollovers to Roth IRAs
***** Non-refundable credit, dependents and full-time students are not eligible
****** One dollar in benefits will be withheld for every $2 in earnings above the limit (under full retirement age)
******* One dollar in benefits will be withheld for every $3 in earnings above the limit (year reaches retirement)
There is no limit on earnings beginning the month an individual attains full retirement age (FR is 65 for those born prior to 1938, 67 for those born after 1959, with a sliding scale between 65-67 for all others)
Please contact Feeley & Driscoll's Boston Accounting Firm by Email or call 1 (888) 875-9770 to learn more.
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