NEWSLETTERS
Volume 2, Issue 1 ..... January 2001
Cost of Living Adjustments LIMIT 1999 2000 LIMIT 1999 2000 Defined Benefit Plans—The maximum dollar limitation for annual benefits
Under defined benefit plans under IRC Section 415(b)(1)(A). The limitation for annual benefits is the lesser of the current dollar amount (as adjusted for inflation) or 100% of the participant’s average compensation for his highest 3 years.
| $135,000 | $140,000 | 401(k)/403(b)/Existing
SARSEP Elective
Deferral Limit—The limitation
on cumulative elective deferrals to a
401(k), 403(b) tax deferred annuity,
simplified employee pension in a tax
year, as coordinated under IRC Section
402(g)(1).
| $10,500 | $10,500 | | 403(b) Catch Up Limit– The special catch-up election for employees participating in a 403(b) tax deferred annuity who have had at least 15 years of service with an educational organization, hospital, home health agency, health and welfare service agency, church or convention or association of churches. | $13,500 | $13,500 | Compensation Limit—The annual limit of compensation that may be taken into account for contribution purposes in accordance with IRC Section 401(a)(17). | $170,000 | $170,000 | Defined Contribution Plan 415
Dollar Limit—The dollar limitation for annual additions under defined contribution plans under IRC Section 415(c)(1)(A). The limitation for annual additions is the lesser of the current dollar amount (as adjusted for inflation) or 25% of compensation.
| $30,000 | $35,000 | Definition of Highly Compensated Employees—The compensation threshold used for determining highly compensated employees under IRC Section 414(q)(1)(B). | $85,000 | $85,000 | | 457 Deferral Limits—The limitation for deferrals to 457 plans under IRC Sections 457(b)(2) and (c)(1). Contributions under an eligible 457 deferred compensation plan are limited to the lesser of 33% of includible compensation of the current dollar amount. | $8,000 | $8,500 | SIMPLE Retirement
Accounts—Compensation taken into account that an employee may elect to defer under a SIMPLE retirement plan described in IRC Section 408(p)(2).
| $6,000 | $6,500 | | | | | Compensation for SEPs—Compensation taken into account to determine eligibility for simplified employee pensions (SEPs). | $450 | $450 |
The Social Security Administration also released its cost of living adjustments for 2001: Taxable Wage Base 2000 2001 For Social Security $76,200 $80,400 Released by the Internal Revenue Service in its October announcement detailing cost-of-living adjustments to certain dollar limits for retirement plans. These adjustments went into effect January 1, 2001. This information is provide to you by Administrative Retirement Service, Inc. If you have additional questions, please call us at 630-469-2030.
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Retirement Services, Inc. 2000
Published
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