global Tax New Retirement Plan Contribution Limits for 2020 November 08, 2019 Disclaimer This post was published more than two years ago, and some information may now be out of date. We want to help you make the best decisions possible—please connect with your advisor or check out our latest resources for the most current guidance. 401k contribution limits have changed for the New Year. Take a look at some adjustments to phase-out ranges and contribution limits for 2020. The Internal Revenue Service has issued the annual cost of living adjustments for 401(k) and IRA contributions, pension plans, and other retirement related matters. The limitsIndividual Retirement Account Limits 2020 (Roth and traditional)CONTRIBUTION LIMITS201920182017IRA Contribution Limit$6,000$6,000$5,500IRA Catch-Up Contributions$1,000$1,000$1,000401(k), 457 and 403(b)CONTRIBUTION LIMITS202020192018401(k), 457 and 403(b) maximum annual elective deferral limit$19,500$19,000$18,500401(k), 457 and 403(b) catch up contribution limit for those 50 and over$6,500$6,000$6,000You can make contributions up to the IRS contribution limits noted above or up to $285,000 in 2020—here’s how that number has changed through the years. 202020192018Annual Compensation Limit$285,000$280,000$275,000SIMPLE- Savings Incentive Match Plan for EmployeesCONTRIBUTION LIMITS202020192018SIMPLE employee deferrals$13,500$13,000$12,500SIMPLE catch up deferrals$3,000$3,000$3,000Simplified Employee Pension (SEP)CONTRIBUTION LIMITS202020192018SEP annual compensation limit$285,000$280,000$275,000SEP minimum compensation$600$600$600SEP maximum contribution$57,000$56,000$55,000Phase-out ranges for 2020:Traditional IRA MAGI Limits202020192018Married filing jointly; a spouse who participates in an employer-sponsored plan$104,000- $124,000$103,000- $123,000$101,000- $121,000Married filing jointly; a spouse who does not participate in an employer sponsored plan$196,000- $206,000$193,000- $203,000$189,000- $199,000Single or Head of Household$65,000- $75,000$64,000- $74,000$63,000- $73,000For Roth IRAs, if your MAGI falls within the applicable range, you can make a partial contribution, but if it exceeds the top of the range, you are not allowed to make a contribution. Roth IRA MAGI Limits202020192018Married filing jointly$196,000- $206,000$193,000- $203,000$189,000- $199,000Single or Head of Household$124,000- $139,000$122,000- $137,000$120,000- $135,000What is the social security wage base for 2020? 202020192018Social Security Wage Base$137,700$132,900$128,700 Interested in learning more about tax-advantaged retirement saving strategies?Contact our Tax Team for more information.The TCJA…So Many Changes, So Many Questions…we can help you navigate this huge tax overhaul! Need help with your tax planning? Contact any member of our Tax Services Team.
