The Washington Report

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November 7, 2018

Health

IRS Releases Adjusted Applicable Dollar Amount Determining PCORTF Fee

On November 6, 2018, the Internal Revenue Service (IRS) released Notice 2018-85, indicating that the adjusted applicable dollar amount that applies for determining the Patient-Centered Outcomes Research Trust Fund (PCORTF) fee for policy years and plan years ending on or after October 1, 2018, and before October 1, 2019, is $2.45. This adjusted applicable dollar amount has been determined using the percentage increase in the projected per capita amount of the National Health Expenditures published by the Department of Health and Human Services in February 2018. Sections 4375 and 4376, added to the Code by the Affordable Care Act, impose a fee on issuers of specified health insurance policies and plan sponsors of applicable self-insured health plans to help fund the PCORTF.

IRS Notice 2018-85 is available here.

Retirement

IRS 2019 Official Indexed Figures for Retirement Plans and Other Employee Benefit Plans; 401(k) Contribution Limit Increases to $19,000 for 2019

The Internal Revenue Service (IRS) issued Information Release 2018-211 on November 1, 2018, providing the 2019 official indexed figures for retirement plans and other employee benefit plans. The IRS issued technical guidance detailing these items in Notice 2018-83. Following are the official limits of most interest to large and medium employers, as well as the official 2019 key employee pay thresholds for top-heavy plans.

• Section 402(g) annual dollar limit for pretax contributions to Section 401(k), 403(b), and 457 plans: $19,000 (up from 2018 limit of $18,500)
• Section 414(v) annual dollar limit on catch-up contributions for age 50 and over: $6,000 (unchanged from 2018)
• Section 414(q) pay threshold for highly compensated employees: $125,000 (up from 2018 limit of $120,000)
• Section 415 limit for defined benefit plans: $225,000 (up from 2018 limit of $220,000)
• Section 415 limit for defined contribution plans: $56,000 (up from 2018 limit of $55,000)
• Section 401(a)(17) recognizable pay limit: $280,000 (up from 2018 limit of $275,000)
• Section 416 pay threshold for key employees in a top-heavy plan: $180,000 (up from 2018 limit of $175,000)

IRS Information Release 2018-211 is available here.

IRS Notice 2018-83 is available here.

An Aon bulletin on the 2019 indexed figures (in PDF format) is available here and in the Publications section of this report.

PBGC Posts Table on Present Value of Maximum Guarantee
On November 1, 2018, the Pension Benefit Guaranty Corporation (PBGC) posted a table showing the applicable present values for 2019 plan years. The PBGC also provided a two-column version of the table for copying.

The PBGC table is available here.

Aon Publications

IRS 2019 Official Indexed Figures for Retirement Plans and Other Employee Benefit Plans

The Internal Revenue Service (IRS) issued Information Release 2018-211 on November 1, 2018, providing the 2019 official indexed figures for retirement plans and other employee benefit plans. The IRS issued technical guidance detailing these items in Notice 2018-83.

The Aon bulletin, which provides the official limits of most interest to large and medium employers, as well as the official 2019 key employee pay thresholds for top-heavy plans, is available here.