Internal Revenue Service Announces Cost-of-Living Adjustments for 2019: IRA Regular Contribution Limit will Increase to $6,000 | Wolters Kluwer
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  • Internal Revenue Service Announces Cost-of-Living Adjustments for 2019: IRA Regular Contribution Limit will Increase to $6,000

    Mike Schiller Onward

    by Mike Schiller, Consultant, Tax Advantaged Accounts, Wolters Kluwer

    Published November 02, 2018




    On November 1, 2018 the Internal Revenue Service announced retirement plan related cost-of-living adjustments (COLAs) for 2019. After several years without an increase to the traditional and Roth individual retirement account (IRA) regular contribution limit, there will be a $500 increase for 2019. Additionally, income thresholds that determine traditional IRA deductibility, Roth IRA eligibility, and saver’s tax credit eligibility will slightly increase. Those limits as well as simplified employee pension (SEP) limits, elective deferral limits, and Savings Incentive Match Plan for Employees of Small Employers (SIMPLE) IRA deferral limits for 2019 are as follows:

    IRA Contribution Limits
    Tax Year
    Contribution Limit
    Catch-Up Contribution
    Age 50 and Older Contribution Limit
    2019
    $6,000
    $1,000
    $7,000

    Traditional IRA Deductibility MAGI Thresholds*
    Filing Status
    Tax Year
    Full Deduction
    Partial Deduction
    No Deduction
    Single
    2019
    ≤ $64,000
    Between $64,000 and $74,000
    ≥ $74,000
    Married, Joint
    2019
    ≤ $103,000
    Between $103,000 and $123,000
    ≥ $123,000
    Married, Joint (not active participant but spouse is)
    2019
    ≤ $193,000
    Between $193,000 and $203,000
    ≥ $203,000
    Married, Separate
    2019
    N/A
    < $10,000
    ≥ $10,000
    *Applies to individuals that actively participate in an employer sponsored retirement plan.

    Roth IRA Eligibility MAGI Thresholds
    Filing Status
    Tax Year
    Full Contribution
    Partial Contribution
    No Contribution
    Single
    2019
    ≤ $122,000
    Between $122,000 and $137,000
    ≥ $137,000
    Married, Joint
    2019
    ≤ $193,000
    Between $193,000 and $203,000
    ≥ $203,000
    Married, Separate
    2019
    N/A
    < $10,000
    ≥ $10,000

    Saver’s Tax Credit MAGI Thresholds
    Filing Status
    Credit is 50% of Contribution if Income is:
    Credit is 20% of Contribution if Income is:
    Credit is 10% of Contribution if Income is:
    No Credit if Income is:
    Married, Joint
    ≤ $38,500
    $38,501 - $41,500
    $41,501 - $64,000
    > $64,000
    Head of Household
    ≤ $28,875
    $28,876 - $31,125
    $31,126 - $48,000
    > $48,000
    All Other Filers
    ≤ $19,250
    $19,251 - $20,750
    $20,751 - $32,000
    > $32,000

    SEP Contribution Limits
    Tax Year
     
    2019
    The lesser of 25% of the first $280,000 of compensation or $56,000

    Elective Deferral Limits
    Tax Year
    Deferral Limit
    Catch-Up Deferral
    Age 50 and Older Total Deferral Limit
    2019
    $19,000
    $6,000
    $25,000

     
    Tax Year
    SIMPLE Deferral Limit
    Catch-Up Deferral
    Age 50 and Older Total Deferral Limit
    2019
    $13,000
    $3,000
    $16,000

    For an opportunity to learn more about IRAs and other tax advantaged accounts, including HSAs and CESAs, consider joining us for one of our IRA, HSA, or CESA Live Streaming events offered on a variety of topics. For more information call us at 1-800-552-9408.



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