The Secretary of the Treasury announced the 2020 limits for qualified retirement plans and IRAs based on cost of living increases. The Consumer Price Index for All Urban Consumers is the benchmark used to determine the index. As a result, most of the 2020 dollar limits will increase as noted in the included chart. IRS Notice 2019-59 sets forth the annual dollar limitations effective Jan. 1, 2020, as required under Section 415(d) of the Internal Revenue Code. For 2020, employees will be able to defer up to $19,500 into their qualified defined contribution plans, and an additional $6,500 for those over the age of 50, for a combined total of $26,000. Highly compensated employees who earn more than $130,000 and who participate in both qualified and nonqualified plans will have a slightly greater amount of their compensation allocated to the qualified plan with the increase of the compensation limit from $280,000 to $285,000.
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