The IRS has announced cost-of-living adjustments for 2020 retirement plan contributions. For 2020, the amounts that individuals will be able to contribute to 401(k), 403(b), and 457(b) retirement plans will increase $500 to $19,500. The catch-up contribution limit for employees age 50 and over will also increase $500 to $6,500.
This chart summarizes the limitations for 2020 (amounts that changed for 2020 are shown in bold):
| Contribution Limits | 2019 |
2020 |
| Elective Deferral Limit – 401(k), 403(b) and 457(b) Plans | $19,000 | $19,500 |
| Catch-Up Contribution Limit | $6,000 | $6,500 |
| Elective Deferral Limit – SIMPLE Retirement Plan | $13,000 | $13,500 |
| Catch-Up Contribution Limit – SIMPLE Retirement Plan | $3,000 | $3,000 |
| Contribution Limit – IRA | $6,000 | $6,000 |
| Catch-Up Contribution Limit – IRA | $1,000 | $1,000 |
Benefits and Compensation |
||
| Defined Contribution Plan Addition Limit | $56,000 | $57,000 |
| Defined Benefit Plan Annual Benefit Limit | $225,000 | $230,000 |
| Annual Compensation Limit | $280,000 | $285,000 |
| Highly Compensated Employee Limit | $125,000 | $130,000 |
| Key Employee Compensation Limit | $180,000 | $185,000 |
The Social Security Administration earlier announced that the Social Security Wage Base for 2020 will increase to $137,700 from $132,900.
If you have questions about the new pension plan limitations, please contact Brent Gambill (937-449-5539) or Edie Crump (937-449-5530).
