The IRS has released the retirement contribution limits for the 2020 tax year. The new limits are adjusted based on increases in the cost of living.
| 2020 | 2019 | |
| 401(k), 403(b), 457(b) deferral limits | $19,500 | $19,000 |
| 401(k), 403(b) catch-up deferral limits for 50 and older | $6,500 |
$6,000 |
| Annual limitation on compensation | $285,000 |
$280,000 |
| Defined benefit limitation | $230,000 | $225,000 |
| Highly compensated employee compensation threshold | $130,000 |
$125,000 |
| Key employee compensation (officer) threshold | $185,000 | $180,000 |
| SIMPLE Deduction | $13,500 |
$13,000 |
| SIMPLE catch-up contribution | $3,000 | $3,000 |
| IRA contribution limit | $6,000 | $6,000 |
| IRA catch-up contribution limit | $1000 | $1000 |
| Social Security Taxable Income Limit | $137,700 | $132,900 |
If you have questions about the new contribution limits, or would like to understand how this may impact your retirement and tax strategies, contact us.