On November 1, IRS issued Notice 2018-83, providing the cost of living adjustments affecting dollar limitations for pension plans and other retirement-related items for tax year 2019.
Highlights include the increased contributions limits for employees who participate in 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan; the increase is from $18,500 to $19,000 for 2019. Additionally, the limit on annual contributions to an IRA, which last increased in 2013, is increased from $5,500 to $6,000. The catch-up contribution limit for individuals aged 50 and over, however, is not subject to an annual cost-of-living adjustment and remains at $1,000.
The income ranges for determining eligibility to make deductible contributions to traditional Individual Retirement Arrangements (IRAs) and to contribute to Roth IRAs all increased for 2019. The income phase-out range for taxpayers making contributions to a Roth IRA is $122,000 to $137,000 for singles and heads of household, up from $120,000 to $135,000. For married couples filing jointly, the income phase-out range is $193,000 to $203,000, up from $189,000 to $199,000.