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2020 Benefit Limits

November 7, 2019

Overview

The Internal Revenue Service and Social Security Administration have announced the benefit plan and employment tax limits for 2020. Certain limitations will not change for 2020 because they are not subject to annual adjustments or because the increase in the cost-of-living index did not meet the statutory thresholds that trigger their adjustment. However, other limitations will change because the increase in the index did meet the statutory thresholds.

The limits for 2020, as compared to those in effect for the current year, are set forth below. The limits that have changed are printed in bold.

Retirement Plan Limits

 

2019

2020

Limits on benefits and contributions

            401(k) & 403(b) plans, elective deferral limit

            457(b) plan, total contribution limit

            Age 50 catch-up contribution limit

            Defined contribution plan, total contribution limit

            Defined benefit plan, annual accrual limit

$19,000

$19,000

$6,000

$56,000

$225,000

$19,500

$19,500

$6,500

$57,000

$230,000

“Highly compensated employee” status

$125,000

$130,000

Annual compensation limit

$280,000

$285,000

“Key employee” officer status

$180,000

$185,000

SIMPLE plans

            Elective deferral limit

            Catch-up contribution limit

$13,000

$3,000

$13,500

$3,000

IRAs

            Contribution limit

            Catch-up contribution limit

$6,000

$1,000

$6,000

$1,000

 
Health Care FSA  
 

2019

2020       

Annual salary reduction limit

$2,700

$2,750

 

Health Savings Accounts

 

2019

2020

Annual HSA contribution deduction limit

            Self-only coverage

            Family coverage

            Catch-up contribution

$3,500

$7,000

$1,000

$3,550

$7,100

$1,000

Out-of-pocket spending limit

            Self-only coverage

            Family coverage

$6,750

$13,500

$6,900

$13,800

Minimum annual deductible

            Self-only coverage

            Family coverage

$1,350

$2,700

$1,400

$2,800

 

Qualified Transportation Fringe Benefit

 

2019

2020

Maximum monthly qualified parking benefit

$265

$270

Maximum monthly qualified transit pass benefit

$265

$270

 

Social Security Limits

 

2019

2020

FICA wage base

$132,900

$137,700

Earnings test thresholds

            Before normal retirement age

            Year of normal retirement age

$17,640

$46,920

 

$18,240

$48,600

Maximum monthly benefit at full retirement age

$2,861

$3,011

 

For further information or questions regarding the 2020 benefit limits, please contact Wally Miller at 541-686-3299 or wmiller@schwabe.com.

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