Happy New Year! 2010 is sure to bring some changes, including a few tax planning ones for your retirement plans. It is important to make sure you familiarize yourself each year with these numbers, especially if you are trying to max out your contributions to your retirement accounts. Getting these set for payroll deductions is certainly one thing, but making sure you can plan your budget accordingly is another. Fortunately, there has not been much change for most folks this year, so this will be a brief column.

             Contribution limits for 401k, 403b, 457, and SEP IRA plans will hold at $16,500. For those of you ages 50 and over, you can drop an extra $5500 “Catch-Up” contribution in there as well if you are a little behind on your retirement savings program or trying to recover from late 2008 losses. The maximum limit is $49,000, which includes the employee’s contribution from their paycheck and any matching, profit sharing, or safe harbor contribution from the business. These figures do not include traditional Pension Plans. They use a different system of limits that goes all the way up to $195,000. They are based on things like salary, age, pension design, and about a dozen actuaries (a la Jack Nicholson from “About Schmidt”) crunching the mess out of numbers that make the IRS tax code look legible.

             Using a traditional plain vanilla IRA? Your limit is still $5000 with a “Catch-Up” of $1000 if you qualify.  But, you don’t have a plain vanilla IRA being a business owner do you?  No, didn’t think so. (If you said “yes” you should hit yourself.)

             For you HR managers, business owners, etc… your mandatory ERISA filings as of January 1, 2010 will now have to all be done electronically, much like e-filing with income tax returns.

             EFAST2 is the new system in use and applies to all Form 5500 reports filed for plan years beginning on or after January 1, 2009, except Form 5500-EZ which is still to be filed directly with the IRS on paper. In addition, any amended or late filings submitted after December 31, 2009 must be filed electronically using the new system. You will need to go online to register to use the system. More information can be obtained by going to www.efast.dol.gov.

             We obviously do not have the space here to go into all the intricacies of the new system, so make certain you do your homework and fiduciary responsibility should it apply to you!

             If you would like more information on what all the new 2010 tax limits are, you can email stewart@bruceshieldsfinancial.com. Also thank you to Beverly Haslauer of The Haslauer Group - Third Party Administrators (TPAs) for providing the updated info. You can always visit their site as well for more data at www.haslauergroup.com.

             Though I had fully intended to explore the radical estate changes for this new year, Congress has not decided yet quite how they wish to steal your money. One way or another, I think a full article dedicated to this massive problem is needed, especially this year. Look to February for that one, I should think.

             By the way, did you make a New Year’s resolution to have a full review done of your benefits program structure? Hmmm?  Now, I’m off to the gym. Hoping THIS New Year’s resolution actually sticks!