Increase in 2019 Tax Limits for Businesses


2019 Business Tax LimitsA variety of 2019 tax limits affecting businesses are annually indexed for inflation, and many have gone up for 2019. Here’s a look at some that may affect you and your business.

Deductions

  • Section 179 expensing:
    • Limit: $1.02 million (up from $1 million).
    • Phaseout: $2.55 million (up from $2.5 million).
  • Income-based phase-ins for certain limits on the Sec. 199A qualified business income deduction:
    • Married filing jointly: $321,400-$421,400 (up from $315,000-$415,000).
    • Married filing separately: $160,725-$210,725 (up from $157,500-$207,500).
    • Other filers: $160,700-$210,700 (up from $157,500-$207,500).

Retirement Plans

  • Employee contributions to 401(k) plans: $19,000 (up from $18,500).
  • Catch-up contributions to 401(k) plans: $6,000 (no change).
  • Employee contributions to SIMPLEs: $13,000 (up from $12,500).
  • Catch-up contributions to SIMPLEs: $3,000 (no change).
  • Combined employer/employee contributions to defined contribution plans (not including catch-ups): $56,000 (up from $55,000).
  • Maximum compensation used to determine contributions: $280,000 (up from $275,000).
  • Annual benefit for defined benefit plans: $225,000 (up from $220,000).
  • Compensation defining “highly compensated employee”: $125,000 (up from $120,000).
  • Compensation defining “key employee”: $180,000 (up from $175,000).

Other 2019 Tax Limits on Employee Benefits

  • Qualified transportation fringe-benefits employee income exclusion: $265 per month (up from $260).
  • Health Savings Account contributions:
    • Individual coverage: $3,500 (up from $3,450).
    • Family coverage: $7,000 (up from $6,900).
    • Catch-up contribution: $1,000 (no change).
  • Flexible Spending Account contributions:
    • Health care: $2,700 (up from $2,650).
    • Dependent care: $5,000 (no change) .

Additional rules apply to these limits, and they are only some of the limits that may affect your business. Please contact us for more information.

© 2019