The IRS recently announced changes to 401k retirement plans starting January 1 2013.Next year you can contribute $17,500 annually to your retirement plan. This contribution limit, which is $500 higher than this year’s level, is linked to an adjustment to account for inflation. The last increase to contribution limits was in 2011 and is rising now because of automatic inflation adjustments that were previously established.
However , if you’re over 50 at any time in 2013 (even if you turn 50 on Dec. 31, 2013), you can contribute an additional amount called a “catch-up contribution” up to $5,500. This special contribution limit remains unchanged from the 2012 limit. That means workers age 50 or older in 2013 can make a total contribution of $23,000 to their retirement plan accounts.
For more information on 401K benefits and options that may be available to your company and its employees, please contact your LL Roberts Group PEO Consultant (toll free) at 877.878.6463.