IRS Announces Increase in Retirement Plan Limits 2020

The Internal Revenue Service (IRS) announced cost of living adjustments (COLAs) affecting dollar limitations for retirement plans and other retirement-related items for Tax Year 2020. Good news, participants will be able to save more next year!

In general, many of the limits will increase for 2020 because the cost-of-living index met the statutory thresholds that trigger their adjustment.

Contribution/Benefit Limits 2020 2019
Elective Deferrals [401(k), 403(b) & 457 plans] $19,500 $19,000
Catch-Up Contribution $6,500 $6,000
Simple Employee Deferral $13,500 $13,000
Simple Catch-Up Contribution $3,000 $3,000
Annual Contribution Limit $57,000 $56,000
Annual Compensation Limit $285,000 $280,000
Highly Compensated Threshold $130,000 $125,000
Income Subject to Social Security $137,700 $132,900
Key Employee Compensation $185,000 $180,000
DB Plan Annual Benefit Limit $230,000 $225,000

As published by the Internal Revenue Service.

For full details on the pension plan limitations for 2020 click here.

For more information contact our team.

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