In 2020, retirement account contribution limits and catch-up contribution limits were increased by the IRS. In this video, CERTIFIED FINANCIAL PLANNER™ Robert Canavan outlines the changes.
Hi. Today we’re going to talk about contribution limits for retirement accounts for 2020.
The contribution limits for employees who participate in 401(k), 403(b), most 457 plans, and the government’s Thrift Savings Plan (TSP) have increased from $19,000 to $19,500. The catch-up contribution limit for employees age 50 and over has increased from $6,000 to $6,500.
Unfortunately, the limit on annual contributions to an IRA remains unchanged. That will stay at $6,000, and if you’re over age 50, you can add another $1,000 to your contribution as a catch up for individual retirement accounts.
When it comes to SIMPLE retirement accounts, the 2020 limit has increased from $13,500 up from $13,000. Now the catch-up limit for that for people aged 50 and over is still $3,000.
For self-employed small business owners who use a SEP or a Solo 401(k), the limit has increased from $56,000 to $57,000 this year.
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