Estimated Indexed Limits for 2000?

[Guest]

OK, the limitations have been released and they do match the values calculated below!

based on the CPI-U values, you take the average of the July, Aug, Sept values and divide by 145.7667 (the average values for the last quarter of 1993.)

Sept value will not be released until mid Oct.

however, using June, July, Aug

166.2, 166.7, and 167.1 = 500/3 = 166.67

166.67/145.7667 = 1.14338

1.143380 * 150,000 = 171506.94 so 170,000 for $ limit

1.14338 * 9240 = 10,564.83 so 10,500 for deferral

1.14338 * 30,000 = 34,301.39 so still use 30,000. (but maybe 2001 we will hit 35,000!)

1.14338 * 120,000 = 137,205 so use 135,000 for DB limit

the HCE limit is 85,000

and the taxable wage base is 76,200

cpi-u can be found on the web

ftp://ftp.bls.gov/pub/special.requests/cpi/cpiai.txt

[This message has been edited by Tom Poje (edited 10-20-1999).]

[This message has been edited by Tom Poje (edited 10-20-1999).]

[Alf]

I have seen a lot of press lately on projections for the 2000 rate brackets, standard deduction, and tax credit amounts in the individual tax area. Although I know that these numbers cannot be finalized until later in the year, has anyone heard about the projections for retirement plans?

I understand that the following limits are indexed: annual compensation limit, annual limit on elective deferrals, highly compensated employee threshold, the defined contribution plan contribution limit, and the defined benefit plan contribution limit.

Does anyone know what the most current projections are?

[Guest]

the limits have been released.

170,000 comp limit

10500 deferral limit

135,000 db limit

hce limit 85,000

taxabale wage base 76,200

[Dave Baker]

News Release 99-80 is online at http://www.benefitslink.com/IRS/ir99-80.shtml

[Guest]

since it was unclear, the IRS clarified it at the ASPA conference.

The HCE definition of 85,000 is for ees earning 85,000 in the year 2000, so it won't effect plans until the year 2001

[Guest GregSelf]

Tom:

Be careful. See the thread under Retirement Plans In General. Apparently, even officials with the IRS are contradicting each other regarding when the $85K threshhold should be applied. Watson Wyatt has requested a letter ruling on this issue.