IRS Announces Key Plan Limitations for 2016
This announcement is a summary of the issuance of the 10/15 Social Security Administration rp-15-53 and the 10/21 IRS News Release IR-2015-118. It covers cost of living adjustments applicable to dollar limitations for qualified retirement plans, and other limits for tax year 2016.
Retirement Limits
| Plan | 2016 Limit | 2015 Limit |
|---|---|---|
| 401(k) / 403(b) / 457(b) deferrals | $18,000 | $18,000 |
| 415(c) Limit | $53,000 | $53,000 |
| Annual Benefit Limit (Defined Benefit Plans) | $210,000 | $210,000 |
| Annual Compensation Limit | $265,000 | $265,000 |
| Social Security Taxable Wage Base | $118,500 | $118,500 |
| Catch-up Contribution Limit for 401(k) / 403(b) / 457(b) | $6,000 | $6,000 |
Flexible Benefit Related Limits
| Plan | 2016 Limit | 2015 Limit |
|---|---|---|
| Key Employee Limit, Officer Test | $170,000 | $170,000 |
| Highly Compensated Employees (Sec.414q) | $120,000 | $120,000 |
| Health Care Flexible Spending Account | $2,550 | $2,550 |
| Dependent Care Flexible Spending Account | $5,000 | $5,000 |
Health Savings Account Limits
| Plan | 2016 Limit | 2015 Limit |
|---|---|---|
| Single Level for Medical Coverage | $3,350 | $3,350 |
| Family Level for Medical Coverage | $6,750 | $6,650 |
| Catch-Up Contributions (Age 55 or Older) | $1,000 | $1,000 |
Transportation Limits
| Plan | 2016 Limit | 2015 Limit |
|---|---|---|
| Transit (monthly maximum) | $255 | $130 (retroactively raised to $250) |
| Parking (monthly maximum) | $255 | $250 |
Helpful Links
2016 limits reflect issuance of IRS News Release IR-2015-118 released October 21, 2015, and Social Security Administration News Release released October 15, 2015.
The IRS news release can be viewed at: https://www.irs.gov/pub/irs-news/IR-15-118.pdf.
To view the Revenue Ruling 2015-53, please visit: https://www.irs.gov/pub/irs-drop/rp-15-53.pdf.
Are You a Visual Learner?
No problem! We've got you covered. View our 2016 Indexed Figures for Qualified Plans infographic.
