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Author: Deborah Grace

Now is the Time to Confirm that Your 2017 Salary Deferrals Were Within IRS Limits for 2017, Especially if You Made Salary Deferrals Under More Than One Employer’s Plan

Tax Code Section 402(b) imposes annual limits on employee deferral contributions made to a 401(k) or 403(b) plan.  For 2017, the limit is $18,000 if you were under age 50, and $24,000 if you were age 50 or older.  Your form W-2 will show the amount of salary deferrals that your employer withheld from your pay in 2017.  The amount will be included in Box 12 with a code of D, E, F or G indicating the type of plan to which you contributed. If you worked for just one employer in 2017, that employer, as part of its annual testing, will confirm that your 2017 salary deferral contributions to its 401(k) plan or 403(b) plan did not exceed the annual limit.  The annual deferral limits are applied separately to 401(k) plans and 403(b) plans.  If you worked for more than one employer in 2017, it’s up to you to confirm that your salary deferral contributions to two or more 401(k) or 403(b) plans did not exceed the applicable limit.   For example, if you are a professor and you taught courses at two different  universities during the calendar year, and made contributions to each school’s 403(b) plan, you need to confirm that the total of your salary deferrals for 2017 does not exceed the limit. If you find that your salary deferrals exceed the limit, you will need to...

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Tax Blog is published by Dickinson Wright PLLC to inform the public of important developments within the firm and practice areas. The content is informational only and does not constitute legal or professional advice. We encourage you to consult a Dickinson Wright attorney if you have specific questions or concerns relating to any of the topics covered in this blog.