New Qualified Plan Limits Announced

The IRS has issued the new plan limits for 2005. The relevant limits for ESOPs and 401(k) plans are as follows:

• Maximum annual compensation considered eligible pay: $210,000
• Maximum 401(k) elective deferrals: $14,000
• ESOP account balance needed to lengthen five-year distribution: $850,000
• Minimum annual payment on extended ESOP distribution: $170,000
• Highly compensated employee threshold: $95,000
• Section 415 annual addition limit: $42,000
• Key employee dollar limit: $135,000