Each year the Internal Revenue Service (IRS) announces the new limits for various aspects of employee benefits plans, principally because of the increase in the applicable cost-of-living indexes. In general, most plan limitations will not change for 2017 because the increase in the cost-of-living index did not meet the statutory threshold that triggers their adjustment. The IRS announced the following limits and thresholds effective for plan years beginning in 2017.

2017 Pre-tax Limits Released

  2016 2017
Highly Compensated Salary Definition $120,000 $120,000
Key Employee in Top-Heavy Plan Salary Definition $170,000 $175,000
Maximum Pre-Tax Contribution Limits
(401(k)/403(b), most 457 Plans)
$18,000 $18,000
Pre-Tax 401(k) Catch-up Limits
(over age 50)
$6,000 $6,000
Catch-up Contribution SIMPLE 401(k) plans $3,000 $3,000
Maximum Salary Deferral SIMPLE 401(k) plans $12,500 $12,500
Minimum Compensation Amount SEPs $600 $600
Maximum Compensation Amount
(401(a) plans, 403(b) plans, SEPs)
$265,000 $270,000
Health Savings Accounts (HSA) Limits
(employer + employee)
Individual—$3,350
Family—$6,750
Catch Up— $1,000
Individual—$3,400
Family—$6,750
Catch Up— $1,000
Maximum Out-of-Pocket
HSA High Deductible Health Plan (HDHP)
Individual—$6,550
Family— $13,100
Individual—$6,550
Family— $13,100
Minimum Deductible
HSA High Deductible Health Plan (HDHP)
Individual—$1,300
Family— $2,600
Individual—$1,300
Family— $2,600
Transportation Benefits Parking – $255
Transit –  $255
Parking – $255
Transit – $255
Medical Out-of-Pocket Expenses
Flexible Spending Accounts (FSA)
$2,550 $2,600
Dependent Care Expenses
Flexible Spending Accounts (FSA)
$5,000 $5,000
Social Security Taxable Wage Base $118,500 $127,200


Next Steps for Employers:

  1. Note the 2017 IRS Benefit and IRA limits; Employers should update their plan documents with the new IRS limits.
  2. Notify HR Knowledge of all plan changes so we may capture these changes on your benefits-at-a-glance and other important documents by emailing benefitsupport@hrknowledge.com.

This content is provided with the understanding that HR Knowledge is not rendering legal advice. While every effort is made to provide current information, the law changes regularly and laws may vary depending on the state or municipality. The material is made available for informational purposes only and is not a substitute for legal advice or your professional judgment. You should review applicable laws in your jurisdiction and consult experienced counsel for legal advice. If you have any questions regarding this advisory, please contact HR Knowledge at 508.339.1300 or email us.