Thanks, this is very helpful! This is something that my wife and I have been wondering and were a little scared that when we do our taxes for 2008 we would have made the wrong decision.

Per individual. In 2008, a 401k participant can contribute up to $15,500 (those over 50 can contribute another $5,000) to their own account.

The total dollar amount that can be contributed (including both your contributions and your employers') can not exceed 100% of your salary or $46,000 in 2008.

Hope that helps!

Paul,
The maximum contribution limit is per person, so both you and your wife can each contribute up to the $15,500 maximum in 2008 to your plans (plus an additional $5,000 if you're at least 50 years old by the end of the year), as long as each of your contributions does not exceed 100% of your respective salaries.

However, it's important to note that the ability to defer salary into a 401(k) (or a SIMPLE IRA) is a cumulative limit for the year for a single person from ALL plans that he/she participates in. So if you work for two employers that each offer a 401(k) plan, your limit is still only $15,500 of salary deferrals (plus the $5,000 catch-up, if eligible) as a COMBINED maximum to both plans. However, you can still separately contribute to your own individual IRA or Roth IRA, or establish certain other self-employed retirement plans, in addition to your maximum 401(k) salary deferral contributions.

I hope that helps a little!