Few Cost of Living Adjustments for Retirement and Health Plans for 2016


Few Cost of Living Adjustments for Retirement and Health Plans for 2016Few Cost of Living Adjustments for Retirement and Health Plans for 2016 – The IRS has released the cost-of-living adjustments (COLA) affecting dollar limitations for Individual Retirement Accounts (IRAs), defined contribution and other retirement-related items for tax year 2016. In general, most limits will remain unchanged for 2016 because the increase in the cost-of-living index did not meet the threshold that would trigger their adjustment.

The table below compares both the retirement plan and health insurance plan limits for 2014 through 2016, with items that have changed for 2016 asterisked. Further guidance can be found on the IRS website.

 Retirement Plans 2014 Limit 2015 Limit 2016 Limit
 IRA contribution limit $5,500 $5,500 $5,500
 IRA catch-up contributions for ages 50+ $1,000 $1,000 $1,000
IRA AGI Deduction Phase-Out Starting at
 Joint Return $96,000 $98,000 $98,000
 Single or Head of Household $60,000 $61,000 $61,000
 IRA contributor not covered by a workplace retirement plan, but filing joint return with spouse who is $181,000 $183,000 $184,000*
AGI Phase-Out for Contributions to Roth IRA
 Joint Return $181,000 $183,000 $184,000*
 Single or Head of Household $114,000 $116,000 $117,000*
 401(k), 403(b), 457(b)(2) elective deferrals $17,500 $18,000 $18,000
 401(k), 403(b) “catch-up” contributions for ages 50+ $5,500 $6,000 $6,000
 SIMPLE plan elective deferral $12,000 $12,500 $12,500
 SIMPLE “catch-up” contributions for ages 50+ $2,500 $3,000 $3,000
 Defined contribution plan maximum $52,000 $53,000 $53,000
 Defined benefit plan maximum $210,000 $210,000 $210,000
 Maximum includible compensation $260,000 $265,000 $265,000
 Highly compensated employee $115,000 $120,000 $120,000
 FICA taxable wage base $117,000 $118,500 $118,500
 Health Insurance Plans 2014 Limit 2015 Limit 2016 Limit
 Health Savings Account (HSA) contribution limit — individual $3,300 $3,350 $3,350
 HSA contribution limit — family $6,550 $6,650 $6,750*
 HSA “catch-up” contributions for ages 55+ $1,000 $1,000 $1,000
 Minimum deductible for high-deductible health plan (HDHP) — individual $1,250 $1,300 $1,300
 Minimum deductible for HDHP — family $2,500 $2,600 $2,600
 Maximum out-of-pocket for HDHP — individual $6,350 $6,450 $6,550*
 Maximum out-of-pocket for HDHP — family $12,700 $12,900 $13,100*
 Flexible Spending Account (FSA) contribution limit $2,500 $2,500 $2,550

*Represents change from 2015.

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