New Contribution Limits for 401(k) Plans, Traditional and Roth IRA, and Pension Plans

The IRS has announced cost of living adjustments affecting dollar limitations for pension plans and other retirement-related items for tax year 2020. For company retirement plans, the most recognized highlight is the 401(k) contribution limit increase to $19,500 for the new year.

2020

2019

Compensation$285,000$280,000
Taxable Wage Base$137,700$132,900
Highly Compensated Employee (HCE)$130,000$125,000
Key Employee/Officer$185,000$180,000
Defined Contribution Limit$57,000$56,000
Max Contribution Limits (401k, 457, 403b)$19,500$19,000
Max Catch up Age 50+ (401k, 457, 403b)$6,500$6,000
Defined Benefit Limit$230,000$225,000
SIMPLE$13,500$13,000
SIMPLE (Catch up): 50+$3,000$3,000
IRA Contribution Limit$6,000$6,000
IRA Catch up: 50+$1,000$1,000

 

Review the full list of contribution limit changes below and share with your plan participants!

 

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Sources/Disclaimers:

 

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