UBP blog

12/28/2009

IRS dollar limits for 2010, what changes and what remains the same

The new year is fast approaching and it will bring on many new changes for employers and employees both. However, the following are two things you can count on to stay the same.

  1. Maximum contribution levels for 401(k) and other defined contribution plans: Due to the falling cost-of-living index, maximum retirement plan contribution rates will be the same in 2010 as they were in 2009. This means that plan participants will be able to contribute up to $16,500 to the plans in 2010. Also, the dollar limitation for catch-up contributions to an employer defined contribution plan for individuals ages 50 and older will stay the same at $5,500. 
  2. Annual dollar limits to employer-provided transportation plans: As was the case in 2010, the IRS has set $120 per-month as the maximum value of excludable benefits under a qualified commuter benefits plan and $230 as the monthly limit for qualified parking benefits.

These two mentioned above, and virtually all of the IRS’ other annually indexed limits, will remain unchanged for 2010 with a few exceptions.

  • The 2010 out-of-pocket maximum limit for HSA (Heath Savings Account) qualifying high deductible health plans will be $5,950 for individuals (up $150 from 2009 limits) and $11,900 for families (up $300 from 2009 limits)
  • The 2010 maximum excludable amount on an employer-provided adoption assistance program will go up slightly as well to $12,170 (up $20 from last year).

We all know that as employers, you have a lot of minimums, maximums and rules to keep track of to make sure all the benefits you offer comply with all state and Federal regulations. You can count on us to keep you posted if anything changes for the upcoming year.

Share this with your employees:

Employers, feel free to copy and customize this blog for distribution to your employees. You may want to add additional financial information that’s specific to your company, such as the amount or timing of your retirement plan contributions.

Employees will find this useful at the beginning of the year as they review their past finances for tax purposes, plan for the upcoming year and set New Year’s resolutions about money.

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