Retirement plan contribution limits increase for 2020
The IRS has announced the increase in contribution limits for various retirement accounts for 2020.For any employees who participate in 401(k), 403(b) and most 457 plans, as well as the federal government’s Thrift Savings Plan, the contribution limit is now $19,500 in 2020. This is up from the $19,000 limit in 2019.The catch-up contribution limit for individuals 50 and older changed in 2020, after remaining the same in 2019. The new limit will be $6,500 for 2020 up from $6,000 in 2019. This limit hadn’t increased since 2015.The maximum deductible IRA contribution for 2020 has remained the same in 2020 at $6,000, but the phase out AGI’s have increased as follows:
- For Singles and Head of Household filers - $65,000 to $75,000
- For Married Filing Jointly filers - $104,000 to 124,000 (when the contributor is covered by a workplace retirement plan) or $196,000 to $206,000 (when the contributor is not covered by a workplace retirement plan, but their spouse is)
- For Roth IRA’s the phaseout ranges are a little different. If the contributor is single or a head of household the range is $124,000 to $139,000, but if the taxpayer is married filing jointly the range is $196,000 to $206,000.
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