- The IRS increased the contribution limit for employees who participate in 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan from $17,000 to $17,500. That’s one of the new IRS Rules for retirement savings in 2013.
- But it left the catch-up contribution limit for employees aged 50 and over in 401(k), 403(b), most 457 plans and the federal government’s Thrift Savings Plan unchanged at $5,500.
- The limit on annual contributions to an IRA rises to $5,500 in 2013, up from $5,000 in prior years.
- The deduction for taxpayers making contributions to a traditional IRA is phased out for singles and heads of household who are covered by a workplace retirement plan and have modified adjusted gross incomes (AGI) between $59,000 – $69,000 (up from $58,000 – $68,000 in 2012). For married couples filing jointly, when the spouse who makes the IRA contribution is covered by a workplace retirement plan, the income phase-out range is also higher, at $95,000 – $115,000 (up from $92,000 – $112,000). For an IRA contributor who is not covered by a workplace retirement plan and is married to someone who is covered, the deduction is phased out if the couple’s income is between $178,000 – $188,000 (up from $173,000 – $183,000).
- The AGI phase-out range for taxpayers making contributions to a Roth IRA is $178,000 – $188,000 for married couples filing jointly (up from $173,000 – $183,000 in 2012). For singles and heads of household, the new income phase-out range is $112,000 – $127,000 (up from $110,000 – $125,000). For a married individual filing a separate return who is covered by a retirement plan at work, the phase-out range remains $0 -$10,000.
- The AGI limit for the saver’s credit (also known as the retirement savings contribution credit) for low- and moderate-income workers is now $59,000 for married couples filing jointly (up from $57,500 in 2012); $44,250 for heads of household (up from $43,125); and $29,500 for married individuals filing separately and for singles (up from $28,750)
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