2021 Benefit Limits Announced
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Hodgson Russ Employee Benefits Newsletter
The Internal Revenue Service has announced the cost of living adjusted dollar limits applicable to benefit plans for 2021 (see IRS Notice 2020-79). The key limits are listed below:
| 2021 Limit | 2020 Limit | |
| 401(k)/403(b)/457 Plan Maximum Elective Deferral | $19,500 | $19,500 |
| 401(k)/403(b)/457 Catch-Up | $6,500 | $6,500 |
| Defined Contribution Maximum Annual Addition | $58,000 | $57,000 |
| Defined Benefit Maximum Annual Pension | $230,000 | $230,000 |
| Qualified Plan Maximum Compensation Limit | $290,000 | $285,000 |
| Highly Compensated Employee | $130,000 | $130,000 |
| IRA Contribution Limit | $6,000 | $6,000 |
| IRA Catch-Up Contributions | $1,000 | $1,000 |
| SIMPLE Limit | $13,500 | $13,500 |
| SIMPLE Catch-Up | $3,000 | $3,000 |
In addition, the Social Security taxable wage base will increase from $137,700 for 2020 to $142,800 for 2021.
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