Profit Sharing Plans

• Total contributions to profit sharing plans, such as a 401(k), are limited to 25 percent of an employee's compensation up to a maximum of $49,000 for 2010, which, like all these limits, is subject to cost-of-living adjustment for subsequent years. The annual limit on compensation deferral by an employee to a 401(k) is $16,500 in 2010.
  
  

SIMPLE 401(k)

• The annual employee compensation deferral limit for a SIMPLE 401(k) is $11,500 in 2010.
  
  

Catch-Up Contributions

• A profit sharing plan, such as a 401(k), may permit employees age 50 and over to make additional deferrals of compensation. The catch-up contribution limit of a 401(k) is $5,500 for 2010. For a SIMPLE 401(k) the catch-up contribution limit is $2,500 for 2010. Total employee contributions cannot exceed an employee's annual compensation.
  
  

SEP IRA

• Under a SEP plan, contributions from the employer are limited to 25 percent of an employee's compensation up to a maximum of $49,000 for 2010.
  
  

SIMPLE IRA

• In a SIMPLE IRA plan the maximum employer contribution is a match of employee compensation deferral up to 3 percent of compensation. The maximum employee contribution is $11,500 in 2010.
  
  

IRA

• The maximum annual combined contributions to traditional and Roth IRAs is $5,000 in 2010. The maximum combined contributions for someone age 50 or older is $6,000 in 2010. IRA contributions cannot exceed 100 percent of taxable compensation.