Does the U. S. of A. want to take away your 401(k)?
I’ve had a couple of phone conversations lately about required annuitization of 401(k) accounts. (“Annuitization” means converting a lump sum into a monthly income stream.) It’s something the Department of Labor (DOL) is looking at (wasting a lot of taxpayer money, of course). I wouldn’t take it too seriously, but it’s worth a quick discussion, and some of the public comments are definitely worth reading!
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An MRP Plans, Inc. update…
1) The key limitation numbers for 2011 (and the old 2010 numbers) are:
| 2010 | 2011 | |
| Maximum annual benefit | $195,000 | $195,000 |
| Maximum annual contribution | $49,000 | $49,000 |
| Maximum 401(k) deferral | $16,500 | $16,500 |
| 401(k) deferral catchup (over age 50) | $5,500 | $5,500 |
| Maximum SIMPLE deferral | $11,500 | $11,500 |
| SIMPLE catch-up (over age 50) | $2,500 | $2,500 |
| Maximum IRA contribution | $5,000 | $5,000 |
| IRA catch-up (over age 50) | $1,000 | $1,000 |
| Annual compensation limit | $245,000 | $245,000 |
| Social Security Wage Base | $106,800 | $106,800 |
| Medicare maximum | Unlimited | Unlimited |
| Comp. threshold for Highly Compensated Employees | $110,000 | $110,000 |
| Income (exclusion) threshold for SEPs | $550 | $550 |
(No change for the last two years.)
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