Employees will be able defer a maximum of $10,500 to their401(k) plans next year, rather than the $10,000 cap currently in effect, under newcost-of-living adjustments announced by the IRS that go into effect January 1. Inaddition, the maximum annual benefit that can be funded through a defined benefit planwill rise to $135,000 from $130,000, although the limitation for defined contributionplans will remain unchanged at $30,000. In related news, the IRS has reportedly decidednot to issue an anticipated comprehensive guidance on 401(k) plans by the end of the year,but may instead publish narrower proposed regulations, although it’s unclear whenthey’ll be released. We’ll keep you posted.
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