Retirement plan limitations.

• Position: News & Trends

The IRS recently announced 2005 retirement plan limitations, www.irs.gov/retirement. Selected limitations are:

2005 2004 Exclusion of elective deferrals regarding Sec. $14,000 $13,000 401(k) and certain other plans [Sec. 402(g) (1) and (3)] Defined contribution plan annual addition [Sec. $42,000 $41,000 415(c) (1) (A)] Defined benefit plan annual benefit [Sec. $170,000 $165,000 415(b) (1) (A)] Annual compensation limit [Secs. 401(a) (17), $210,000 $205,000 404(l), 408(k)(3) (C) and 408(k) (6) (D) (ii)] Definition of highly compensated employee [Sec. $95,000 $90,000 414(q) (1) (B) Dollar limitation for defining key employee in $135,000 $130,000 top-heavy plan [Sec 4416(i) (1) (A) (i)] Compensation requirement for simplified $450 $450 employee pensions [Sec 408(k) (2) (C)] Dollar limitation concerning SIMPLE retirement $10,000 $9,000 accounts (Sec. 408(p) (2) (E)] Limitation on deferrals regarding deferred $14,000 $13,000 compensation plans of state and local governments and tax-exempt organizations [Sec. 457(e) (15)] Dollar limitation for catch-up contributions for individuals aged 50 or over made to: Applicable employer plans described in Secs. $2,000 $1,500 401(k) (11) or 408(q) Other applicable...