On November 6, 2019 the IRS announced changes to the maximum amount employees can contribute to their 401(k) plans, increasing from $19,000 to $19,500 for the 2020 tax year.
The catch-up contribution for employees over 50 years old was also increase from $6,000 to $6,500.
For SIMPLE IRA plans, the maximum employee contribution was raised to $13,500 (up from $13,000).
Traditional IRA and ROTH IRA contribution limits remained unchanged at $6,000, with the catch-up contribution for individuals over 50 remaining at $1,000.
For more information on the 2020 tax year changes, including phase-out limits, check the IRS website.
There's still time to max out your contributions for 2019! Contributions to employer sponsored plans should be made before year end. Any personal IRA contributions to either a traditional IRA or Roth can be made before the tax filing deadline in April 2020.
If you'd like to maximize your retirement contributions, let us know how we can help!
This content is for general information only and is believed to be accurate and reliable as of posting date but may be subject to change. We do not provide tax or legal advice. Please consult your own tax or legal professional regarding your specific situation.