Employee Benefits-IRS Announces Pension Plan Limits for 2010

In IR-2009-94 (Oct. 15, 2009), the IRS announced the cost of living adjustments for the dollar limits imposed by the Internal Revenue Code on retirement plans for 2010. Most of these limits did not change from 2009. Thus, the following dollar limits will apply for 2010, each of which is the same amount as for 2009:

–the limit under Section 402(g)(1) on the exclusion for elective deferrals which are described in Section 402(g)(3), and which are made under 401(k) and other plans, will be $16,500;

–the limit under Section 414(v)(2)(B)(i) for catch-up contributions to a plan, other than a SIMPLE 401(k) plan described in Section 401(k)(11) or a SIMPLE IRA described in Section 408(p), for individuals aged 50 or older will be $5,500;

–the limit under Section 414(v)(2)(B)(ii) for catch-up contributions to a SIMPLE 401(k) plan described in Section 401(k)(11) or a SIMPLE IRA described in Section 408(p), for individuals aged 50 or older will be $2,500;

–the limit on the annual benefit under a defined benefit plan under Section 415(b)(1)(A) will be $195,000;

–the limit on annual additions under a defined contribution plan under Section 415(c)(1)(A) will be $49,000;

— the annual compensation limit under Sections 401(a)(17), 404(l), 408(k)(3)(C), and 408(k)(6)(D)(ii) will be $245,000;

–the limit under Section 416(i)(1)(A)(i) concerning the definition of a key employee in a top-heavy plan will be $160,000; and

–the limit used in the definition of highly compensated employee under Section 414(q)(1)(B) (applied in the preceding year-here 2009) will be $110,000.

A table from the IRS, which shows the dollar limits for pension plans from 2003 through 2010, is here.