In Notice 2019-59, the IRS highlighted the following adjustments taking effect on Jan. 1, 2020, for 401(k), 403(b) and most 457 plans:

Defined Contribution Plan Limits20202019Change
Maximum employee elective deferral$19,500$19,000+$500
Employee catch-up contribution (if age 50 or older by year-end) **$6,500$6,000+$500
Defined contribution maximum limit, all sources (employee + employer)$57,000$56,000+$1,000
Defined contribution maximum limit (if age 50 or older by year end); maximum contribution all sources plus catch-up$63,500$62,000+$1,500
Employee compensation limit for calculating contributions$285,000$280,000+$5,000
Key employees’¬†compensation threshold for nondiscrimination testing$185,000$180,000+5,000
Highly compensated employees’ threshold for nondiscrimination testing$130,000$125,000+5,000
**The $6,500 catch-up contribution limit for participants age 50 or older applies from the start of the year to those turning 50 at any time during the year.

Source: IRS Notice 2019-59.

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