The IRS has announced contribution and benefit limits for 2020. Click here for details.
What do they mean for me?
Good news! The limits have increased across many areas so you can save more for your retirement.
- The contribution limit for employees who participate in 401(k), 403(b), and most 457 plans increased from $19,000 to $19,500.
- If you are over age 50, you are eligible for a catch-up contribution, which has increased from $6,000 to $6,500.
- There were no changes to the limit on annual contributions to IRAs, which remain at $6,000 and catch up contributions also remain at $1,000.
Other limits included in the IRS notice include the following:
| 2020 | 2019 | 2018 | |
| RETIREMENT PLANS | |||
| Max Elective Deferrals: 401(k)/403(b) – 402(g)(1) | $19,500 | $19,000 | $18,500 |
| Max Catch-up: 414(v)(2)(B)(i) | $6,500 | $6,000 | $6,000 |
| 457 Elected Deferrals: 457(e)(15) | $19,500 | $19,000 | $18,500 |
| Max Defined Contribution: 415(c)(1)(A) | $57,000 | $56,000 | $55,000 |
| Max Annual Compensation: 401(a)(17)/404(I) | $285,000 | $280,000 | $275,000 |
| Annual Compensation Grandfathered Governmental Plans | $425,000 | $415,000 | $405,000 |
| IRA: INDIVIDUAL RETIREMENT ACCOUNTS | |||
| Max Contributions: 219(b)(5)(A) | $6,000 | $6,000 | $5,500 |
| Max Catch-up: 219(b)(5)(B) | $1,000 | $1,000 | $1,000 |
| SEP: SIMPLIFIED EMPLOYEE PENSION PLANS | |||
| Minimum Compensation: 408(k)(2)(c) | $600 | $600 | $600 |
| Max Compensation: 408(k)(3)(c) | $285,000 | $280,000 | $275,000 |
| SIMPLE PLANS | |||
| Max Contributions: 408(p)(2)(E) | $13,500 | $13,000 | $12,500 |
| Max Catch-up: 414(v)(2)(B)(ii) | $3,000 | $3,000 | $3,000 |
| OTHER | |||
| Highly Compensated Threshold: 414(q)(1)(B) | $130,000 | $125,000 | $120,000 |
| Defined Benefit Limits: 415(b)(1)(A) | $230,000 | $225,000 | $220,000 |
| Key Employee Threshold: 416(i)(1)(A)(i) | $185,000 | $180,000 | $175,000 |
| Social Security Taxable Wage Base | $137,700 | $132,900 | $128,400 |