Copyright
2005,
New Perspectives, Inc.
All rights reserved
Provisions
of the Economic Growth and Tax Relief Reconciliation Act
of 2001 (EGTRRA) and Jobs and Growth Tax Relief
Reconciliation Act of 2003 (JGTRRA).
Increased
Contribution Limits
Traditional
and Roth IRAs
YEAR
LIMIT
Catch-Up*
2009
$5,000
$1000
2010
$5,000
$1000
Simple
IRAs
YEAR
LIMIT
Catch-Up*
2009
$10,500
$2,500
2010
$11,500
$2,500
401K
Plans
YEAR
LIMIT
Catch-Up*
2009
$15,500
$5,000
2010
$16,500
$5,500
403
B Plans
YEAR
LIMIT
Catch-Up*
2009
$15,500
$5,000
2010
$16,500
$5,500
Section
457 Plans
YEAR
LIMIT
Catch-Up*
2009
$15,500
$5,000
2010
$16,500
$5,500
Simplified
Employee Pension SEP Plans
Year
Compensation
LIMIT
Maximum
Considered
2009
$49,000
$245,000
2010
$49,000
$245,000
*Catch-up
contributions limited to persons over age 50.
Coverdell Education
Savings Accounts - ESA
Maximum annual contribution
increases to $2,000
Special needs beneficiaries are
exempted from the prohibition against
contributions being made after the beneficiary
turns 18
Corporations, tax-exempt
organizations and other entities may contribute
to an Education Savings Account
Contributions counted toward any
tax year are permissible until April 15 of the
following year, rather than being cut off on
December 31
Excess contributions must be
recovered by May 31 (vs. April 15) following the
year for which the excess contribution was made.
529
College Savings Plans
Qualified
distributions are now free of federal income
tax, giving these plans even greater appeal
Non-qualified
withdrawals are subject to a 10% federal tax
penalty on earnings (vs. a 10% state penalty)
$65,000
for an individual and $130,000 for a married
couple can be contributed and treated as a 5
year contribution (consult your CPA for details)
