October 24, 2021

Volume XI, Number 297

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October 22, 2021

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Internal Revenue Service: 2017 Cost of Living Adjustments

The Internal Revenue Service has announced the 2017 cost of living adjustments to various limits. The adjusted amounts generally apply for plan years beginning in 2017. Some of the adjusted amounts, however, apply to calendar year 2017.

Employee Benefit Plans

Plan Year

2017

2016

401(k), 403(b), 457 deferral limit

$18,000

$18,000

Catch-up contribution limit (age 50 or older by end of 2016)

$6,000

$6,000

Annual compensation limit

$270,000

$265,000

Annual benefits payable under defined benefit plans

$215,000

$210,000

Annual allocations to accounts in defined contribution plans

$54,000

(but not more than 100% of compensation)

$53,000

(but not more than 100% of compensation)

Highly compensated employee

Compensation more than $120,000 in 2016 plan year

Compensation more than $120,000 in 2015 plan year

 

Health Savings Accounts

Calendar Year

2017

2016

Maximum contribution

  • Family

  • Self

  • $6,750

  • $3,400

  • $6,750
    $3,350 

Catch-up contribution (participants who are 55 by end of year)

  • $1,000

  • $1,000

Minimum deductible

  • Family

  • Self

  • $2,600

  • $1,300

  • $2,600

  • $1,300

Maximum out-of-pocket

  • Family

  • Self

  • $13,100

  • $6,550

  • $13,100
    $6,550 

 

Social Security

Calendar Year

2017

2016

Taxable wage base

$127,200

$118,500

Maximum earnings without loss of benefit

 

 

 

  • Under full retirement age

  • $1,410/mo. ($16,920/yr.)

  • $1,310/mo. ($15,720/yr.)

  • Year you reach full retirement age

  • $3,740/mo. up to mo. of full retirement age ($44,880/yr.)

  • $3,490/mo. up to mo. of full retirement age ($41,880/yr.)

 

Social Security Retirement Age

Year of Birth

Retirement Age

Prior to 1938

Age 65

1938

65 and 2 months

1939

65 and 4 months

1940

65 and 6 months

1941

65 and 8 months

1942

65 and 10 months

1943 - 1954

66

1955

66 and 2 months

1956

66 and 4 months

1957

66 and 6 months

1958

66 and 8 months

1959

66 and 10 months

1960 and later

67

© 2021 Varnum LLPNational Law Review, Volume VI, Number 301
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About this Author

Jeffrey DeVree, employment benefits and tax attorney, Varnum
Partner

Jeff is a partner and leads the Employee Benefits Team. He has 30 years of experience working with employers, executives and third-party administrators on a wide range of employee benefit, executive compensation and individual retirement matters, including plan design, plan administration, benefit plan disputes and tax planning for retirement.

He also helps solve complex tax issues in business and investment transactions, especially those involving pass-through entities and oil and gas activities.

616/336-6566
Thomas H. Bergh, Varnum Law Firm, Grand Rapids, Estate Planning Attorney, IRS Litigation Lawyer
Partner

Tom has over 30 years of experience in helping clients efficiently and effectively define theirestate planning goals and to arrange their affairs accordingly. His expertise includes facilitating the direction of a client-centered and directed strategy and then drafting clear and understandable legal documents to implement it, thereby protecting client wealth, closely-held businesses, and families from taxes, post-mortem chaos and expense, and unnecessary complexity. He has expertise and experience in dealing with the IRS in administrative hearings and litigation,...

248-567-7421
Larry J. Titley, Varnum, employee benefits attorney
Of Counsel

Although Larry has retired from active practice, he is available to consult with clients in the areas of his previous practice, which included:

  • representing employers on employee benefit matters, including pension plans, profit sharing 401(k) plans, employee stock ownership plans, and other retirement and fringe benefits programs; and
  • working with third-party administrators of employee benefit plans, trustees of multi-employer pension and health care plans, and individuals planning for retirement.

Larry had served as general employee...

616/336-6571
John Arendshorst, Varnum Law Firm, Grand Rapids, Employee Benefits Attorney
Partner

John is a member of the firm’s Employee Benefits Team. He counsels employee benefit plan sponsors with respect to compliance with ERISA and IRS requirements for 401(k) plans, ESOPs and other defined contribution plans, defined benefit plans, and deferred compensation arrangements. John also advises clients on employee benefits issues in the context of corporate transactions, including qualified plan compliance issues, change-in-control agreements, continuation of health coverage, and golden parachute payments under Section 280G. John is experienced in negotiating and...

616-336-6560
Kristy L. De Vos, Employee Benefits Paralegal, Varnum,
Paralegal

Kristy focuses her Employee Benefits practice on retirement plans. In addition to drafting plans, she submits plans to IRS for opinion and determination letters, and submits plans to IRS under the Voluntary Compliance Program and to the U.S. Department of Labor under the Voluntary Fiduciary Correction Program.

Her experience also includes drafting plan amendments, consent resolutions, Summary Plan Descriptions, Summaries of Material Modifications, 204(h) Notices, and plan administrative forms. Kristy answers client questions about plan administration and assists...

616-336-6564
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