Contribution Limits

This section discusses the statutory limits on how much you can save in a 401(k) plan.

• Traditional 401(k) plan
• Safe Harbor 401(k) plan
• SIMPLE 401(k) plan
• Contribution Limits

• 2008 COLA Increases

  • IRS Releases 2008 Inflation Adjustments [IR-2007-172]
  • Rev. Proc. 2007-66lists the cost-of-living adjustments for 2008.
  • 2008 Pension Plan Limitations [IR-2007-171]
  • COLA Increases for Dollar Limitations on Benefits and Contributions.

Traditional 401(k) plan

Employers who contribute to employees’ 401(k) accounts have further options. You can contribute a percentage of each employee’s compensation to the employee’s account (called a nonelective contribution), or you can match the amount your employees decide to contribute (within the limits of current law) or you can do both...