2015 Retirement Plan Contributions Limits

On October 23, 2014, the IRS released the 2015 tax year cost of living adjustments which include higher contribution levels for most of the company sponsored qualified tax-deferred savings plans.  The contribution limits for IRA’s remain unchanged from the 2014 limits.  The maximum contribution levels for 2015 include …

•  Elective deferral contribution limits for employees participating in 401(k), 403(b) and most 457 plans, as well as the federal government’s Thrift Savings Plans is now $18,000 (up from $17,500).
•  Participants aged 50 and older can also make "catch-up" contributions of $6,000 annually into 401(k), 403(b) and Thrift Savings Plans.  This is an increase of $500 from the catch up provisions available in 2014.
• The limit on annual contributions to an Individual Retirement Arrangement (IRA) remains unchanged at $5,500.

The additional IRA catch-up contribution limit for individuals aged 50 and over is not subject to an annual cost-of-living adjustment and remains $1,000.

In addition to retirement plan contribution limits, the IRS also announced the income phase out range for deductions for taxpayers contributing to Individual Retirement Accounts for 2015.  The 2015 phase-out range on deductions for singles and heads of household who are contributing to traditional IRAs and are already covered by workplace retirement plans will be when adjusted gross income is between $61,000 and $71,000 (up from $60,000 to $70,000 in 2014).   For married couples filing jointly, in which the spouse who makes the IRA contribution is covered by a workplace retirement plan, the income phase-out range will be $98,000 to $118,000.  This 2015 phase-out range is up $2,000 from the 2014 phase out range.

For IRA contributors who are not covered by a workplace retirement plan and are married to someone who is covered, the deduction is phased out if the couple’s adjusted gross income is between $183,000 and $193,000. This is up from $181,000 to $191,000 in 2014.  For a married individual filing a separate return who is covered by a workplace retirement plan, the phase-out range is not subject to an annual cost-of-living adjustment and remains $0 to $10,000.  The 2015 AGI phase-out range for married couples filing jointly and making contributions to a Roth IRA is $183,000 to $193,000.  This is up from $181,000 to $191,000 in 2014.  The 2015 AGI phase-out range for singles and heads of households who make contributions to a Roth IRA is $116,000 to $131,000.  This is up $2,000 from the 2014 phase out range.  For a married individual filing a separate return, the Roth IRA phase-out range is not subject to an annual cost-of-living adjustment and remains $0 to $10,000.

Barry L Weller, EA is the president of Barry Weller & Associates with offices at 216 E Philadelphia Ave, Boyertown, PA 19512.   Phone (610) 367-8280.    He is an enrolled agent, licensed to represent taxpayers before the IRS.      Revised 10/27/2014