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2016 Cost of Living Adjustments

October 21, 2015
Employee Benefits Advisory

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 Year 2016 2015

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 employee Compensation more than $120,000 in 2015 plan year Compensation more than $115,000 in 2014 plan year
Health Savings Accounts
Calendar Year 2016 2015

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
  • $13,100
  • $6,550
  • $12,900
  • $6,450
Social Security
Calendar Year 2016 2015

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 Birth Retirement Age
Prior to 1938 Age 65
1938 65 and 2 months
1939 65 and 4 months
1940 65 and 6 months
1941 65 and 8 months
1942 65 and 10 months
1943 - 1954 66
1955 66 and 2 months
1956 66 and 4 months
1957 66 and 6 months
1958 66 and 8 months
1959 66 and 10 months
1960 and later 67

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