What is the maximum amount of elective deferrals an employee can contribute to a 403(b) plan?
The maximum amount of elective deferrals an employee can contribute annually to a 403(b) is generally the lesser of: • 100% of includible compensation; or • $16,500 (for 2011 and subject to annual cost-of-living increases). However, this general limit is reduced by the amount of elective deferrals an employee makes to: • 401(k) plans; • SIMPLE IRA plans; • Salary Reduction Simplified Employee Pension (SARSEP) plans; • other 403(b) plans; and • Code §501(c)(18) plans. If the plan allows: • an employee who has worked for a qualified organization for 15 or more years may, if he or she meets certain requirements, be able to make additional contributions of up to $3,000 for up to 5 years (see 15-year rule in Pub. 571, Tax-Sheltered Annuity Plans (403(b) Plans); and • an employee who is age 50 or older may make an additional catch-up contribution of $5,500 (for 2011 and subject to annual cost-of-living increases), reduced by the amount of catch-up contributions made to other plans.