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Annual Limitations

Qualified retirement plans are funded by contributions from employers and/or employees. These contributions are subject to a number of annual limitations. Compliance with these limitations is important since the qualification of the plan is at stake.

HAVE ANY LIMITATIONS INCREASED FOR 2020?

The following limits have increased for 2020:

  •   401(k) Elective Deferrals increased to $19,500 from $19,000
  •   The Annual Addition Dollar Maximum increased to $57,000 from $56,000
  •   The Annual Compensation Limit increased to $285,000 from $280,000
  •   The SEP Annual Compensation Limit increased to $285,000 from $280,000
  •   The Annual Defined Benefit Plans Limit increased to $230,000 from $225,000
  •   The Social Security Wage Base increased to $137,700 from $132,900

WHAT ARE THE ANNUAL LIMITATIONS FOR 2020?

  2020 Limitations 2019 Limitations
Defined Benefit Dollar Maximum $230,000 $225,000
Annual Addition Dollar Maximum $57,000 $56,000
Employee 401(k)/403(b)/457 Contributions $19,500 $19,000
Catch-up Contributions (Age 50 or older) $6,500 $6,000
Highly Compensated Employee Threshold $130,000 $125,000
Annual Compensation $285,000 $280,000
Social Security Taxable Wage Base $137,700 $132,900
Self-only HSA contribution limit $3,550 $3,500
Family HSA contribution limit $7,100 $7,000