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2016 Cost of Living Adjustments

October 21, 2015

The Internal Revenue Service has announced the 2016 cost of living adjustments to various limits. The adjusted amounts generally apply for plan years beginning in 2016. Some of the adjusted amounts, however, apply to calendar year 2016.

Employee Benefit Plans
Plan Year20162015
401(k), 403(b), 457 deferral limit$18,000$18,000
Catch-up contribution limit (age 50 or older by end of 2016)$6,000$6,000
Annual compensation limit$265,000$265,000
Annual benefits payable under defined benefit plans$210,000$210,000
Annual allocations to accounts in defined contribution plans$53,000(but not more than 100% of compensation)$53,000(but not more than 100% of compensation)
Highly compensated employeeCompensation more than $120,000 in 2015 plan yearCompensation more than $115,000 in 2014 plan year
Health Savings Accounts
Calendar Year20162015
Maximum contribution Family Self$6,750 $3,350$6,650 $3,350
Catch-up contribution (participants who are 55 by end of year)$1,000$1,000
Minimum deductible Family Self$2,600 $1,300$2,600 $1,300
Maximum out-of-pocket Family Self$2,600 $1,300$12,900 $6,450
Social Security
Calendar Year20162015
Taxable wage base$118,500$118,500
Maximum earnings without loss of benefit
Under full retirement age$1,310/mo. ($15,720/yr.)$1,310/mo. ($15,720/yr.)
Year you reach full retirement age$3,490/mo. up to mo. of full retirement age ($41,880/yr.)$3,490/mo. up to mo. of full retirement age ($41,880/yr.)
Social Security retirement age
Year of BirthRetirement Age
Prior to 1938Age 65
193865 and 2 months
193965 and 4 months
194065 and 6 months
194165 and 8 months
194265 and 10 months
1943-195466
195566 and 2 months
195666 and 4 months
195766 and 6 months
195866 and 8 months
195966 and 10 months
1960 and later67

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