Your Quick Guide to 2020 Retirement Plan Contribution Limits
Author: Siân Killingsworth / 6 Nov 2019 / 401(k) Resources, IRA Resources, Retirement News
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Curious how much you can invest toward your retirement in 2020? The IRS has announced the 2020 contribution limits for retirement and health savings accounts. Changes include increased contribution limits for 401(k) and 403(b) plans, as well as income limits for IRA contribution deductibility. Additionally, the salary threshold to classify “key” and “highly compensated employees” has been announced. Review our quick guide of the updated limits below.
2020 401(k) and 403(b) individual contribution limits (IRS 402(g) Limit)
Age 49 and younger
$22,500
Age 50 and older
Additional $7,500
The IRS has also set limits for the total amount that may be contributed to your retirement savings 401(k) account from all sources combined (IRS section 415 limit). This includes any employer matching or profit-sharing contributions, and any employee after-tax contributions. For 2020, the maximum is $57,000.
Every plan is different, so it’s important to refer to your Plan Document for any compensation or other applicable limits.
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2020 Highly Compensated and Key Employee definitions and limits
Key Employee Officer Compensation
$185,000
Highly Compensated Employee
$130,000
Annual Compensation Limit
$285,000
2020 Roth and Traditional IRA contribution limits
Age 49 and under
Up to $6,500 (must have earned income)
Age 50 and older
Additional $1,000
2020 Traditional IRA modified adjusted gross income limit for partial deductibility
Single
$73,000 – $83,000
Married – Filing joint returns
$116,000 – $136,000
Married – Filing separately
$0 – $10,000
Non-active participant spouse
$218,000 – $228,000
2020 Roth IRA modified adjusted gross income phase-out ranges
Single
$124,000 – $139,000
Married – Filing joint returns
$196,000 – $206,000
Married – Filing separately
$0 – $10,000
2020 Simple IRA contribution limits
Age 49 and under
$14,500
Age 50 and older
$19,000
2020 Health Savings Accounts (HSA) contribution limits
Individual (employer + employee)
$3,550
Family (employer + employee)
$7,100
Age 55 or older**
Additional $1,000
**Catch-up contributions can be made at any time during the year in which the HSA participant turns 55.
If you need more detailed guidance, see IRS Notice 2019-59.
