The IRS also announced cost-of-living adjustments to dollar limitations for pension plans and other retirement plans for tax year 2012. The contribution limit for employees who participate in 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan is increased from$16,500 to $17,000.
- The catch-up contribution limit for those
aged 50 and over remains unchanged at $5,500.
- The deduction for taxpayers making contributions
to a traditional IRA is phased out for singles and heads of household who are
covered by a workplace retirement plan and have modified adjusted gross incomes
(AGI) between $58,000 and $68,000. For married couples filing jointly, in which
the spouse who makes the IRA contribution is covered by a workplace retirement
plan, the income phase-out range is $92,000 to $112,000. For an IRA contributor
who is not covered by a workplace retirement plan and is married to someone who
is covered, the deduction is phased out if the couple’s income is between
$173,000 and $183,000.
- The AGI phase-out range for taxpayers making
contributions to a Roth IRA is $173,000 to $183,000 for married couples filing jointly. For singles and
heads of household, the income phase-out range is $110,000 to $125,000. For a married individual filing a separate return who is covered by a retirement plan at work, the phase-out range remains $0 to $10,000.
- The AGI limit for the saver’s credit for low-and moderate-income workers is $57,500 for married couples filing jointly; $43,125 for heads of
household; and $28,750 for married individuals filing separately and for singles.