At last, it’s official – the Internal Revenue Service has announced the contribution and benefit limits for 2020!
The IRS announced this and other changes in Notice 2019-59, posted today here. The guidance provides cost-of-living adjustments affecting dollar limitations for pension plans and other retirement-related items for tax year 2020.
Highlights of Changes for 2020
The contribution limit for employees who participate in 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan is increased from $19,000 to $19,500.
The catch-up contribution limit for employees aged 50 and over who participate in these plans is increased from $6,000 to $6,500.
The limitation regarding SIMPLE retirement accounts for 2020 is increased to $13,500, up from $13,000 for 2019. The compensation amount under § 408(k)(2)(C) regarding simplified employee pensions (SEPs) remains unchanged at $600.
Click here to read more!