Publication 553 - Highlights Of 2002 Tax Changes Page 21
ADVERTISEMENT
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31SEP contributions (including elective deferrals) and the
The MEA has been repealed. Therefore, MAC is the
deduction for contributions increases to $200,000.
lesser of the limit on annual additions or the limit on
elective deferrals.
SIMPLE Plans
Church employees. Prior to 2002, certain church em-
ployees were allowed to use a minimum exclusion allow-
For years beginning after 2001, the following changes
ance instead of MEA to figure MAC. MAC for church
apply to SIMPLE plans. For more information, see Publica-
employees for years beginning after 2001 generally is the
tion 560, Retirement Plans for Small Business.
lesser of the limit on annual additions or the limit on
elective deferrals.
Salary reduction contributions. The limit on salary re-
Changes to the limit on annual additions. The alterna-
duction contributions to a SIMPLE plan increases after
tive limits on annual additions have been repealed. There-
2001, as follows.
fore, you cannot use any of the following to figure your limit
on annual additions.
Year
Limit
•
The year of separation from service limit.
2002 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 7,000
2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
8,000
•
The any year limit.
2004 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
9,000
•
2005 and later years . . . . . . . . . . . . . . . . . . . . .
10,000
The overall limit.
Note. The $10,000 limit is subject to adjustment after 2005 for
Increased limit on annual additions. The limit on an-
cost-of-living increases.
nual additions has increased to the lesser of $40,000 or
your includible compensation for your most recent year of
Catch-up contributions. A SIMPLE plan can permit par-
service. For 2001, the limit on annual additions was the
ticipants who are age 50 or older at the end of the calendar
lesser of $35,000 or 25% of your compensation.
year to make catch-up contributions, as follows.
Includible compensation for foreign missionaries. If
you are a foreign missionary, your includible compensation
Year
Catch-Up Limit
for your most recent year of service does not include
2002 . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 500
contributions made by the church during the year to your
2003 . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,000
403(b) account.
2004 . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,500
2005 . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,000
Increase in the limit on elective deferrals. The limit on
2006 and later years . . . . . . . . . . . . . . .
2,500
elective deferrals has been increased from $10,500 to
Note. The $2,500 limit is subject to adjustment after 2006 for
$11,000. The limit on elective deferrals will increase by
cost-of-living increases.
$1,000 each year through 2006.
The catch-up contribution a participant can make for a
Catch-up contributions. If you are age 50 or older by the
year cannot exceed the lesser of the following amounts.
end of 2002, you may be permitted to make catch-up
•
contributions to your 403(b) plan.
The catch-up contribution limit.
•
Figuring catch-up contributions. When figuring al-
The excess of the participant’s compensation over
lowable catch-up contributions, combine all contributions
the salary reduction contributions that are not
made by your employer on your behalf to the following
catch-up contributions.
plans.
•
Qualified retirement plans.
403(b) Plans
•
403(b) plans.
•
Simplified employee pension (SEP) plans.
For years beginning after 2001, the following changes
apply to 403(b) plans. For more information, see Publica-
•
SIMPLE plans.
tion 571, Tax-Sheltered Annuity Plans (403(b) Plans) For
Employees of Public Schools and Certain Tax-Exempt
The total amount of the catch-up contributions on your
Organizations.
behalf to all plans maintained by your employer cannot be
more than the annual limit. The limit is $1,000.
Changes in figuring your maximum amount contribut-
Rollovers to and from 403(b) plans. You can roll over,
able (MAC). In years prior to 2002, the maximum amount
tax free, money and other property that would otherwise be
contributable (MAC) to a 403(b) plan generally was the
taxable from an eligible retirement plan to a 403(b) plan.
least of:
Additionally, you can roll over, tax free, money and other
•
The maximum exclusion allowance (MEA),
property that would otherwise be taxable from a 403(b)
plan to an eligible retirement plan.
•
The limit on annual additions, and
If a distribution includes both pre-tax contributions and
•
The limit on elective deferrals.
after-tax contributions, the portion of the distribution that is
Chapter 3 IRAs and Other Retirement Plans
Page 21
ADVERTISEMENT
0 votes
Related Articles
Related forms
Publication 1212 - List Of Original Issue Discount Instruments - Department Of Treasury - 2002
Financial
Change Of Address Notifi Cation For Individual Income Tax Form - Office Of State Tax Commissioner - State Of North Dakota
Financial
Related Categories
Parent category: Financial