The IRS has announced changes to retirement plan limits for 2021

Each year the Internal Revenue Service announces the cost-of-living adjustments applicable for all types of qualified retirement plans and IRAs. The various annual contribution limitations and other important indexes which govern all plans either remain unchanged year-over-year or may rise depending on whether the Consumer Price Index meets a threshold level dictating an increase. 

For 2021, highlights include:

  • The Annual Salary Deferral Contribution Limit for 401(k), 403(b) and 457 plans remained the same at $19,500.
  • The Salary Deferral Catch-up Contribution Limit for employees aged 50 and over who participate in these plans also remained the same at $6,500.
  • The Total Annual Contribution Limit (EE+ER) for defined contribution plans increases from $57,000 to $58,000.
  • The Annual Compensation Limit increases from $285,000 to $290,000.

The Retirement Plan Company is pleased to present this table for your convenience. Contact Us for more assistance..

Annual Compensation and Contribution Limits for Qualified Retirement Plans

(Amount is in $)

 20212020201920182017
401(k) and 403(b) Deferral Limit19,50019,50019,00018,50018,000
457 Deferral Limit19,50019,50019,00018,50018,000
401(k), 403(b), 457 Catch-up Contribution Limit6,5006,5006,0006,0006,000
SIMPLE Deferral Limit13,50013,50013,00012,50012,500
SIMPLE Catch-up Contribution Limit3,0003,0003,0003,0003,000
Annual Compensation Limit290,000285,000280,000275,000270,000
Defined Benefit 415 Limit230,000230,000225,000220,000215,000
Defined Contribution 415 Limit58,00057,00056,00055,00054,000
Dollar Limit for HCEs130,000130,000125,000120,000120,000
Dollar Limit for Key Employee185,000185,000180,000175,000175,000
Social Security Taxable Wage Base142,800137,700132,900128,400127,200