Individual taxpayers will be able to set aside up to $17,000 in various employer-sponsored retirement plans for the year 2012. This $17,000 limit represents the maximum amount that a person can save as an elective salary deferral inside a section 401(k), 403(b) or 457 plan. People age 50 years old or older can save an additional $5,500 as a designated "catch up" contribution.
The total amount that can be contributed by both employees and their employers for 2012 is set at $50,000.
Retirement plan limitations for 401(k) and similar plans are updated annually by the IRS for various cost-of-living adjustments, a process also called inflation-indexing. The 2012 adjustments were announced by the IRS in IR-2011-103, and the IRS has posted a three-year chart summarizing various retirement plan limitations on the IRS.gov Web site.