Annual Retirement Plan Limits

U.S. tax laws place limits on the dollar amount of contributions to retirement plans and IRAs and the amount of benefits under a pension plan. The Internal Revenue Code (IRC) requires the limits to be adjusted annually for cost-of-living increases. IRS Announces 2019 new Retirement plan contribution limits for 401(K) and more.

Highlights of changes for 2020

  • The contribution limit for employees who participate in 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan is increased from $19,000 to $19,500.
  • The catch-up contribution limit for employees aged 50 and over who participate in these plans is increased from $6,000 to $6,500.
  • The limitation regarding SIMPLE retirement accounts for 2020 is increased to $13,500, up from $13,000 for 2019.
  • SIMPLE Catch-up Contribution Limit remains unchanged at $3,000.
  • The limit on annual contributions to an IRA remains unchanged at $6,000. The additional catch-up contribution limit for individuals aged 50 and over is not subject to an annual cost-of-living adjustment and remains $1,000.

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Annual Compensation and Contribution Limits for Qualified Retirement Plans
Amount is in $
401(k) and 403(b) Deferral Limit19,50019,00018,50018,000
457 Deferral Limit19,50019,00018,50018,000
401(k), 403(b), 457 Catch-up Contribution Limit6,5006,0006,0006,000
SIMPLE Deferral Limit13,50013,00012,50012,500
SIMPLE Catch-up Contribution Limit3,0003,0003,0003,000
Annual Compensation Limit285,000280,000275,000270,000
Defined Benefit 415 Limit230,000225,000220,000215,000
Defined Contribution 415 Limit57,00056,00055,00054,000
Dollar Limit for HCEs130,000125,000120,000120,000
Dollar Limit for Key Employee185,000180,000175,000175,000
Social Security Taxable Wage Base137,700132,900128,400127,200