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Schannep Investment Advisors, Inc.
Your future is why we're here.
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2005 Tax-Year
Changes |
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The Internal Revenue Service has announced cost-of-living
adjustments applicable to the dollar limitations for pension plans for Tax
Years beginning in 2005. Many of the pension plan limitations will change
for 2005. Effective January 1, 2005, the following dollar limitations will
apply:
The limitation under section 402(g)(1) is increased from $13,000 to $14,000
annually. This limitation affects elective deferrals to section 40 1 (k)
plans, 403(b) plans and 457 plans.
The dollar limitation for CATCH-UP contributions to an applicable employer
plan for individual aged 50 or over is increased from $3,000 to $4,000.
The limitation on the annual benefit under a defined benefit plan is
increased from $165,000 to $170,000.
The limitation for defined contribution plans under section 415~(1 )(A) is
increased from $40,000 to $42,000.
The annual compensation limit is increased from $205,000 to $210,000
The dollar limitation concerning the definition of key employees in a
top-heavy plan is increased from $130,000 to: $135,000
The limitation used in the definition of highly compensated employees is
increased from $90,000 to $95,000.
The annual compensation limitation for eligible participants in certain
governmental plans is increased from $305,000 to $315,000.
The compensation amount regarding simplified employee pensions (SEP) remains
unchanged at $450.
The limitation regarding SIMPLE retirement accounts is increased from $9,000
to $10,000. The limitation on deferrals concerning
deferred compensation plans of state and local governments and tax-exempt
organization is increased from $13,000 to $14,000.
The 2005 Social Security tax wage base was increased from $87,000 to
$90,000. |
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This information does not
constitute professional tax advice. Please forward all tax related questions
to a qualified tax professional.
This report is
prepared for general circulation and is for informational purposes only. It
is not intended as an offer or solicitation for the purchase or sale of any
financial instrument or service. Market prices and other data may be
obtained from outside sources and is not warranted as to completeness or
accuracy. Any comments, statements and/or recommendations made herein do not
necessarily reflect those of First Allied Securities, Inc., its subsidiaries
or affiliates, and are subject to change without notice.
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Securities offered through
First Allied Securities, Inc. A register broker/dealer. Member FINRA/SIPC.
Schannep Investment Advisors is a registered investment
adviser in the state of Arizona. First Allied Securities, Inc. does not endorse or
support this web site, nor are they affiliated with Schannep Investment Advisors,
Inc.
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