November 4, 2014

2015 Pension and Retirement Plan Limits and 2015 Social Security and Medicare Adjustments (article)

The 2015 plan limits, applicable to defined benefit and defined contribution plans, have been issued by the IRS (highlights below).





Defined benefit plan annual limit



Defined contribution plan annual limit



Elective deferral limit for purposes of cash or deferred arrangements (401(k) plans) and tax-sheltered annuities (403(b) plans)





Maximum deferral limit for 457 plans



>Age 50 Catch-up Contribution Limit to 401(k), 403(b) or 457(b) Plans



Maximum deferral limit for SIMPLE plans



>Age 50 Catch-up Contribution Limit to SIMPLE Plans



Minimum compensation considered in determining eligibility for a SEP



Threshold for Highly Compensated Employee (HCE)



Key Employee Compensation Limit for Top Heavy Plan Purposes





Annual Compensation Limit





























2015 Social Security Cost-of-living Adjustment

The 2015 cost of living adjustment to the Social Security wage base is increased from $117,000 to $118,500.  The Medicare tax is generally assessed on all wages.  The combined tax rate remains at 7.65% - the Social Security portion is 6.2% on wages up to the applicable maximum taxable amount; the Medicare portion is 1.45% on all wages.  Additional adjustments are included in the SSA’s Fact Sheet: 2015 Social Security Cost-of-Living Adjustments.


2015 Medicare Parts A and B: Premium and Deductible Rates

The Centers for Medicare and Medicaid Services has released the applicable Medicare Part A and Part B premium and deductible rates for 2015.



Part A



  • No monthly Part A premium for those with 40+ quarters of Medicare-covered employment.
  • $407 per month for people who are not otherwise eligible for premium-free hospital insurance and <30 quarters of Medicare-covered employment.


  • $1,260 for first 60 days of inpatient care;
  • Additional $315 per day for days 61 through 90;
  • Additional $630 per day beyond the 90th day.


Part B Premium and Deductible

The standard Medicare Part B monthly premium ($104.90) the Part B deductible ($147) for 2015 remains unchanged from 2014.


Source:  Medicare 2014 & 2015 costs at a glance


The information contained in this article is provided as general guidance and may be affected by changes in law or regulation. This article is not intended to replace or substitute for accounting or other professional advice. Please consult a CBIZ professional. This information is provided as-is with no warranties of any kind. CBIZ shall not be liable for any damages whatsoever in connection with its use and assumes no obligation to inform the reader of any changes in laws or other factors that could affect the information contained herein.

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