Updated Employee Benefit Plan and IRA Quick Reference Table 2019 and 2020
The Internal Revenue Service has announced the cost-of-living adjustments applicable to dollar limitations for various qualified retirement plans and other amounts for 2020.
Pension plan limitations changed for 2020 because the increase in cost-of-living index met the statutory thresholds that trigger their adjustments. Plan sponsors should verify that their administrative and payroll systems reflect the appropriate limits.
We recommend reviewing communications that specify benefit plan limits for accuracy before materials are given to participants.
If you have any questions, or for more information about the 2020 cost-of-living adjustments for retirement plans, please contact Marci Boyarski, Angie Whiteside, Tom Krieg, Bob Buss, or your Wipfli relationship executive.
| 2019 | 2020 | |
| Compensation Limit [IRC Sec. 401(a)(17)] | $280,000 | $285,000 |
| Defined Benefit Plan Annual Benefit Limit | $225,000 | $230,000 |
| Defined Contribution Plan Annual Contribution Limit | $56,000 | $57,000 |
| Social Security Tax Wage Base | $132,900 | $137,700 |
| Highly Compensated Employee Compensation Threshold | $125,000 | $130,000 |
| Key Employee Officer Compensation Threshold | $180,000 | $185,000 |
| SEP Compensation Threshold | $600 | $600 |
| 401(k), 403(b), 457(b), and SARSEPs | ||
| Elective Deferral Limit 2 | $19,000 | $19,500 |
| Catch-up Contribution 3 | $6,000 | $6,500 |
| SIMPLE Plan | ||
| Elective Deferral Limit 2 | $13,000 | $13,500 |
| Catch-up Contribution 3 | $3,000 | $3,000 |
| IRA | ||
| Contribution Limit 2 | $6,000 | $6,000 |
| Catch-up Contribution 3 | $1,000 | $1,000 |
| Traditional IRA Deduction Phaseout (AGI) | ||
| Single, Head of Household - active participant | $64,000/$74,000 | $65,000/$75,000 |
| Married Filing Separate - any spouse participates | $0/$10,000 | $0/$10,000 |
| Married Filing Joint - nonparticipating spouse | $193,000/$203,000 | $196,000/$206,000 |
| Married Filing Joint - participating spouse | $103,000/$123,000 | $104,000/$124,000 |
| Roth IRA Contribution Eligibility (AGI) | ||
| Married Filing Joint | $193,000/$203,000 | $196,000/$206,000 |
| Single, Head of Household | $122,000/$137,000 | $124,000/$139,000 |
| Married Filing Separate - any spouse participates | $0/$10,000 | $0/$10,000 |
| Retirement Saver's Credit Eligibility (AGI) | ||
| Married Filing Joint | $ 64,000 | $ 65,000 |
| Head of Household | $ 48,000 | $ 48,750 |
| Married Filing Separate, Single | $ 32,000 | $ 32,500 |
Wipfli's Employee Benefit Services practice is an independent, fee-for-service consulting, record keeping and compliance provider dedicated to helping clients meeting their employee benefit needs. Wipfli LLP has been providing qualified and non-qualified plan services for over 30 years.
1This table has been updated based on IRS Notice (2019-59), November 6, 2019.
2This applies to the total of all elective deferrals an individual makes for the year to 401(k) plans, 403(b) plans, SARSEPs, and SIMPLE plans. However, deferrals to each SIMPLE plan in which the individual participates are also limited, as shown later in the table.
3Catch-up contributions are available each year to individuals who reach age 50 by December 31.
