2007 Benefit Plan Limits

The Internal Revenue Code places limits on most employee benefit plans that restrict the amount of employer and employee plan contributions.  Many of these limits adjust each year based on inflation.  The IRS usually issues a press release in mid-October that announces the coming year's limits.  Some of the 2007 limits are:

• Elective deferral limit for 401(k), 403(b) and 457(b) plans:            $  15,500
• "Catch-up" (age 50+) deferrals (same for all plans above)               $   5,000
• Total Contributions (sum of employer and employee contributions) $  45,000
• Annual Compensation limit                                                           $225,000
• Highly Compensated Employee threshold                                       $100,000
• SIMPLE plan deferral limit                                                             $ 10,500
• SIMPLE plan "catch up" limit                                                          $  2,500
• High Deductible Health Plan minimum deductible (individual)          $  1,100
• High Deductible Health Plan minimum deductible (family)               $   2,200
• Maximum Health Savings Account contribution (individual)             $   2,850
• Maximum Health Savings Account contribution (family)                  $   5,650

Plan administrators should ensure that their participant communications and payroll processing reflect the updated amounts.