The IRS announced on Feb. 7 that the Tax Cut and Jobs Act of 2017 will not affect the tax year 2018 dollar limitations for retirement plans outlined last year in IR 2017-177 and detailed in Notice 2017-64.
The tax law provides dollar limitations on benefits and contributions under qualified retirement plans, and it requires the Treasury Department to annually adjust these for cost of living increases.
Because the new tax legislation did not change the section of the tax law limiting benefits and contributions for retirement plans, the qualified retirement plan limitations for tax year 2018 previously announced are unchanged.
The tax law also specifies that IRA contribution limits, as well as income thresholds related to IRAs and the saver’s credit, are to be adjusted for changes in the cost of living using procedures used to make cost-of-living adjustments that apply to many of the basic income tax parameters.
Although the new law changed how these cost of living adjustments are made, after taking the applicable rounding rules into account, the amounts for 2018 in the news release and the guidance remain unchanged.