The IRS has updated the contribution limits for 2019. Taxpayers will now be able to contribute $6,000 to their traditional individual retirement accounts in 2019, up from $5,500 that has been in place since 2013. Participants in 401(k) plans will be able to contribute up to $19,000 before taxes next year, up from $18,500. This is great news and should be taken advantage of. Here are some of the highlights of the increase:
- The salary deferral limit for 401(k), 403(b) and 457 plans increases to $19,000.
- The SIMPLE deferral limit increases to $13,000.
- The annual compensation limit increases to $280,000.
- The Social Security Wage Base increases to $132,900.
- The compensation limit for determining who is a highly compensated employee increased for the first time in five years, and is now $125,000.
Click here to download the full list of 2019 Contribution Annual Limits as relating to Financial Planning.