Effect of 2017 Tax Law

Q. Does the federal Tax Cuts and Jobs Act (TCJA), enacted Dec. 22, 2017, affect contribution limits and integration of plans?

A. The original proposal that would have required the aggregation of 403(b), 401(k) and 457(b) plan did not end up being in the final version that President Trump signed into law. The bottom line is that there is no change in their treatment in 2018 under the TCJA. An employee can defer $18,500 into a 403(b), and then another $18,500 into a 457 plan.

Another proposal discussed as the TCJA was being crafted was to have one 415 limit between 401(a) (including k plans) and 403(b) plans. This would have had the effect of permitting no more than $55,000 between the two plans. But that proposal also was not incorporated into the version that is now law. Therefore, we still have two different overall limits for these plans.