Pension Plan Contribution Limitations for 2012

Important Retirement Update: Learn about the Saver's Tax Credit for retirement plan contributions.

The IRS has announced cost of living adjustments for pension plan dollar limitations for Tax Year 2012. Section 415 of the Internal Revenue Code provides for dollar limitations on benefits and contributions under qualified retirement plans, and requires that the IRS annually adjust these limits for inflation and increases in cost-of-living.

What Are the Dollar Amount Limits on Pension Plan Contributions for 2012?

For Tax Year 2012, the limitation on the annual benefit under a defined benefit plan under Section 415(b)(1)(A) is $200,000.

The limitation for defined contribution plans under Section 415(c)(1)(A) is $50,000.

The limitation under Section 402(g)(1) on the exclusion for elective deferrals described in Section 402(g)(3) is $17,000.

The annual compensation limit under Sections 401(a)(17), 404(l), 408(k)(3)(C), and 408(k)(6)(D)(ii) is $250,000.

The dollar limitation under Section 416(i)(1)(A)(i) concerning the definition of key employee in a "top-heavy" plan is $165,000.

The dollar amount under Section 409(o)(1)(C)(ii) for determining the maximum account balance in an employee stock ownership plan subject to a 5 year distribution period is $1,015,000. The dollar amount used to determine the lengthening of the 5 year distribution period is $200,000.

The limitation used in the definition of highly compensated employee under Section 414(q)(1)(B) is $115,000.

The dollar limitation under Section 414(v)(2)(B)(i) for catch-up contributions to an applicable employer plan other than a plan described in Section 401(k)(11) or Section 408(p) for individuals aged 50 or over is $5,500.

The dollar limitation under Section 414(v)(2)(B)(ii) for catch-up contributions to an applicable employer plan described in Section 401(k)(11) or Section 408(p) for individuals aged 50 or over is $2,500.

The annual compensation limitation under Section 401(a)(17) for eligible participants in certain governmental plans that, under the plan as in effect on July 1, 1993, allowed cost of living adjustments to the compensation limitation under the plan under Section 401(a)(17) to be taken into account, is $375,000.

The compensation amount under Section 408(k)(2)(C) regarding simplified employee pensions (SEPs) is $550.

The limitation under Section 408(p)(2)(E) regarding SIMPLE retirement accounts is $11,500.

The limitation on deferrals under Section 457(e)(15) concerning deferred compensation plans of state and local governments and tax-exempt organizations is $17,000.

The compensation amounts under Section 1.61 21(f)(5)(i) of the Income Tax Regulations concerning the definition of "control employee" for fringe benefit valuation purposes is $100,000. The compensation amount under Section 1.61 21(f)(5)(iii) is $205,000.

The adjusted gross income limitation under Section 25B(b)(1)(A) for determining the retirement savings contribution credit for taxpayers filing a joint return is $34,500. The limitation under Section 25B(b)(1)(B) is $37,500. The limitation under Sections 25B(b)(1)(C) and 25B(b)(1)(D) is $57,500.

The adjusted gross income limitation under Section 25B(b)(1)(A) for determining the retirement savings contribution credit for taxpayers filing as head of household is $25,875. The limitation under Section 25B(b)(1)(B) is $28,125. The limitation under Sections 25B(b)(1)(C) and 25B(b)(1)(D) is $43,125.

The adjusted gross income limitation under Section 25B(b)(1)(A) for determining the retirement savings contribution credit for all other taxpayers is $17,250. The limitation under Section 25B(b)(1)(B) is $18,750. The limitation under Sections 25B(b)(1)(C) and 25B(b)(1)(D) is $28,750.

The deductible amount under Section 219(b)(5)(A) for an individual making qualified retirement contributions is $5,000.

The applicable dollar amount under Section 219(g)(3)(B)(i) for determining the deductible amount of an IRA contribution for taxpayers who are active participants filing a joint return or as a qualifying widow(er) is $92,000. The applicable dollar amount under Section 219(g)(3)(B)(ii) for all other taxpayers (other than married taxpayers filing separate returns) is $58,000. The applicable dollar amount under Section 219(g)(7)(A) for a taxpayer who is not an active participant but whose spouse is an active participant is $173,000.

The adjusted gross income limitation under Section 408A(c)(3)(C)(ii)(I) for determining the maximum Roth IRA contribution for taxpayers filing a joint return or as a qualifying widow(er) is $173,000. The adjusted gross income limitation under Section 408A(c)(3)(C)(ii)(II) for all other taxpayers (other than married taxpayers filing separate returns) is $110,000.

Remember: If you made contributions to a retirment plan, you may be able to get a tax credit for it! Find out about the Saver's Tax Credit.

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