The IRS has announced the maximum contribution limits for your 401(k) and other retirement plans for 2012. In general, many of the pension plan limitations will change for 2012 because the increase in the cost-of-living index met the statutory thresholds that trigger their adjustment. However, other limitations will remain unchanged. Highlights include:
Individuals Limits for 401(k): Annual compensation limit $250,000 in 2012 (up from $245,000 in 2011); maximum annual contribution $17,000 in 2012 (up from $16,500 in 2011) with a $5,500 contributions for age 50 and older.
Savings Incentive Match Plan for Employees (SIMPLE): Contribution limit $11,500 with a $2,500 catch up clause for age 50 and older. Remains unchanged from 2011.
Individual Retirement Plans (IRAs): Maximum contribution $5,000 with a $1,000 catch up contribution for those age 50 and older. The contribution can be split between a Roth IRA and a traditional IRA, but must not exceed $6,000. Remains unchanged from 2011.