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IRS UPDATES PENSION PLAN, 401(k) LIMITS

October 23, 2007

The IRS last week issued the limits for qualified plan contributions for 2008 (IR-2007-171). Some key numbers for 2008:

-Maximum 401(k) deferral: $15,500 (same as 2007).
-Additional 401(k) for 50+ taxpayers: $5,000 (same as 2007).
-Maximum defined contribution plan contribution: $46,000 (from $45,000)
-Annual benefit for defined benefit plan: $185,000 (from $180,000).

The maximum 2008 IRA contribution will be $5,000, with a $1,000 additional "catch-up" for taxpayers who turn 50 or older during 2008. For 2007, it is a $4,000 contribution with a $1,000 catch-up.

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