COLA Increases for Dollar Limitations on Benefits and Contributions

 

The tax law places limits on the dollar amount of contributions to retirement plans and IRAs and the amount of benefits under a pension plan. IRC Section 415 requires the limits to be adjusted annually for cost-of-living increases.

IRAs 2021 2020 2019
IRA Contribution Limit $6,000 $6,000 $6,000
IRA Catch-Up Contributions 1,000 1,000 1,000
Traditional IRA AGI Deduction Phase-out Starting at 2021 2020 2019
Joint Return 105,000 104,000 103,000
Single or Head of Household 66,000 65,000 64,000
SEP 2021 2020 2019
SEP Minimum Compensation 650 600 600
SEP Maximum Contribution 58,000 57,000 56,000
SEP Maximum Compensation 290,000 285,000 280,000
SIMPLE Plans 2021 2020 2019
SIMPLE Maximum Contributions 13,500 13,500 13,000
Catch-up Contributions 3,000 3,000 3,000
401(k), 403(b), Profit-Sharing Plans, etc. 2021 2020 2019
Annual Compensation 290,000 285,000 280,000
Elective Deferrals 19,500 19,500 19,000
Catch-up Contributions 6,500 6,500 6,000
Defined Contribution Limits 58,000 57,000 56,000
ESOP Limits

1,165,000

230,000

1,150,000

230,000

1,130,000

225,000

Other 2021 2020 2019
HCE Threshold 130,000 130,000 125,000
Defined Benefit Limits 230,000 230,000 225,000
Key Employee 185,000 185,000 180,000
457 Elective Deferrals 19,500 19,500 19,000
Control Employee (board member or officer) 115,000 115,000 110,000
Control Employee (compensation-based) 235,000 230,000 225,000
Taxable Wage Base 142,800 137,700 132,900