In 2015 taxpayers will be able to put more money away toward retirement.
- Maximum contributions to 401k, 403b, 457 plans will be $18,000.
- Catch up contributions rise to $24000.
- Ceiling on simple IRAs will be $12,500, for those 50 and older: $15,500.
- IRA and Roth contributions remain at $5,500 and $6,500 for those 50 and older.
In addition, retirement contributions can be made on up to $265,000 in salary. The limitation for a defined contribution plan will increase to $53,000. For discrimination testing, anyone over $120,000 is considered highly paid. So there may be further limitations placed on those individuals if lower paid workers don’t participate.
Couples earning between $98,000 AGI and $118,000 (singles with AGI between $61,000 and $71,000) will have a phase out of their deductible IRA deduction. If only one spouse is covered by a plan, the income limitation is raised to $183,000, ending at $193,000.
Income ceilings for Roths increase as well. The contribution phase out begins at AGIs of $183,000 to $193,000 for couples and $116,000 to $113,000 for singles.