2020 RETIREMENT PLAN LIMITS | As Set by the Internal Revenue Service
For the 2020 tax year, the following are limits set by the IRS for contributions to your retirement plan(s).
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 limit on annual contributions to an IRA is remains unchanged for the tax year 2020 at $6,000. The additional catch-up contribution limit for individuals aged 50 and over is not subject to an annual cost-of-living adjustment and remains $1,000.
Under the SECURE Act passed in December 2019, significant changes were made to IRA and retirement plan rules. A few of the most impactful changes include:
- Repeal of the maximum age for making traditional IRA contributions at age 70 ½,
- Increase in the Required Minimum Distribution (RMD) beginning age from age 70 ½ to age 72 for retirement plans and IRAs, and
- Partial elimination of the popular “stretch IRA” strategy.
More information on the SECURE Act will be forthcoming.
IMPORTANT TAX FILING DATES | Keeping You Prepared and On Time
Tax Filing Deadline | Wednesday, April 15, 2020
WHEN SHOULD I EXPECT MY TAX FORMS? | What You Need to Know
RECENT TAX INSIGHTS | Making Sense of Tax Season
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