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Retirement and Healthcare Plan Limit Update for 2018

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Below is a summary of the 2018 compared to 2017 limits regarding a variety of retirement and healthcare limitations imposed by the IRS. There are no significant changes in the dollar amounts for 2018, but some have changed. Every dollar contributed to one of the plans below is a pre-tax approach to enhance a taxpayers’ retirement funds and healthcare related funds that will be spent in the current and/or future years. Somerset wants to make sure our clients are maximizing such enhancements on a pre-tax basis. Don’t hesitate to contact your Somerset advisor with any questions.

    2017     2018
RETIREMENT LIMITATIONS
401(k) / 403(b) / 457 Plan Maximum Elective Deferral $18,000 $18,500
Qualified Plan Compensation Limit $270,000 $275,000
Catch-Up Contribution Limit for all plans other than 401(k)(11) and 408(p) plans $6,000 no change
Catch-up Contribution Limit for 401(k)(11) and 408(p) $3,000 no change
Highly Compensated Employee Definition $120,000 no change
Top Heavy Key Employee Definition $175,000 no change
Defined Contribution Annual Additions Limit $54,000 $55,000
Defined Benefit Annual Benefit Limit $215,000 $220,000
Social Security Taxable Wage Base $127,200 $128,700
FLEXIBLE SPENDING ACCOUNTS (FSAs)
Health FSA Limit $2,600 $2,650
Dependent Care Account
       Married individuals, filing separately $2,500 no change
       Households $5,000 no change
HEALTH SAVINGS ACCOUNT LIMITATIONS (HSAs)
HSA Contribution Limits
       Individual $3,400 $3,450
       Family $6,750 $6,900
       Catch-up $1,000 no change
HDHP Out of Pocket Maximum
       Individual $6,550 $6,650
       Family $13,100 $13,300
HDHP Minimum Annual Deductible
       Individual $1,300 $1,350
       Family $2,600 $2,700