IRS Announces 2012 COLA Increases

October 20th, 2011 by JBWK

The IRS released today the 2012 annual cost-of-living increases for various tax and employee benefit programs.

In addition to addressing compensation limits for IRA contributions and pension plans, the IRS increased by $500 the annual elective deferral maximum for 401(k) plans from $16,500 to $17,000 and increased the total annual deferrals across all defined contribution plans from $49,000 to $50,000.

For employers using high-deductible health plans, the IRS also adjusted the out-of-pocket deductible requirements.

Copies of Revenue Procedure 2011-52 (various topics) and IR-2011-103 (employee retirement plans) set out all the newly adjusted amounts.

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