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 Limits 2020 2019 Change
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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