IRS Releases 2018 Retirement Contribution Limits
By Jordan Sheppherd
The IRS just released Notice 2017-64 (https://www.irs.gov/pub/irs-drop/n-17-64.pdf) making some changes, starting in 2018, to contribution limits of retirement accounts. You can click the link above to read the actual notice, or you can go here to read through the IRS’s overview of the changes.
If you have an IRA, nothing has changed in regards to contribution limits. If you’re under 50 years old, your limit will still be $5,500 and if you’re over 50 years old, you still have a catch up of $1,000 for a total of $6,500.
Phase Outs for IRAs
For you high income earners, make sure to visit the IRS’s overview to see some changes they’re making to “phase outs”. Phase outs determine how much you can make before a Traditional IRA contribution is not deductible. They’re also tweaking phase outs for Roth IRAs, so pay attention to that as well.
If you are a Solo 401(k) client, know that in 2018, the employee contribution limit will go up a whole $500 per year. If you’re under 50 years old, your employee contribution limit will be $18,500. If you’re over 50 years old, you still have a $6,000 catch-up, so your limit would be $24,500. Keep in mind that the total contribution limits stay the same. If you’re under 50 years old, the total contribution limit is $54,000 and if you’re over 50 years old, the total contribution limit is $60,000.