2020 Qualified Plan Cost of Living Increases, 2020 Social Security Taxable Wage Base

By
November 6, 2019

On November 6, 2019 the Internal Revenue Service announced the cost-of-living adjustments for the various qualified retirement plan limits. All of the limits shown below have increased from last year.

 
Qualified Plan LimitCost-of-Living Adjustments
401(k) and 403(b) elective deferral limit2019-$19,000

2020-$19,500

$200,000 compensation limit2019-$280,000

2020-$285,000

$160,000 defined benefit limit2019-$225,000

2020-$230,000

$40,000 defined contribution limit2019-$56,000

2020-$57,000

$80,000 definition of highly compensated employee2019-$125,000

2020-$130,000

SIMPLE IRA deferral limit2019-$13,000

2020-$13,500

Code Section 457 deferred compensation plan deferral limit2019-$19,000

2020-$19,500

Code Section 414(v) catch-up contribution limit for employee deferrals2019-$6,000

2020-$6,500

All of the above are plan year limits (i.e., for the plan year which begins in 2020), with the exception of the Code Section 401(k) and Code Section 403(b) elective deferral limit, which is a calendar year limitation.

In addition, the Department of Health and Human Services has set the maximum taxable wages for the OASDI portion of the social security tax at $137,700 for 2020, which is an increase from the 2019 limit of $132,900.

Back to all News & Insights

Disclaimer

The content in the following blog posts is based upon the state of the law at the time of its original publication. As legal developments change quickly, the content in these blog posts may not remain accurate as laws change over time. None of the information contained in these publications is intended as legal advice or opinion relative to specific matters, facts, situations, or issues. You should not act upon the information in these blog posts without discussing your specific situation with legal counsel.

© 2020 Ruder Ware, L.L.S.C. Accurate reproduction with acknowledgment granted. All rights reserved.