For the second year in a row, the Internal Revenue Service has announced that there will be no change to the maximum allowable contributions to pension plans or to individual retirement accounts in 2011.
Here are the limits that will remain the same in 2011:
The annual limit for employee contributions to a 401(k), 403(b), or to a 457 deferred compensation plan, remains at $16,500 – the same amount that was allowed for 2010 and 2009.
The additional “catch-up” amount for individuals who will be 50 or older at the end of the year also will remain at $5,500. They will be able to contribute a maximum of $22,000 to their employer’s plan next year.
The most you can contribute to an IRA will remain $5,000, or $6,000 for those who will be 50 at the end of the year.
The maximum contribution for Keogh plans and simplified employee pension plans will also remain stable at $49,000.
The maximum contribution to a savings incentive match plan for employees of small employers (SIMPLE) remains at $11,500, and the minimum compensation for required participation in an SEP plan is unchanged at $550. The maximum contribution to a defined benefit plan is still $195,000.
For those of you with both an IRA and an employer-sponsored plan, the IRS has made some small adjustments.