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IRS INCREASES RETIREMENT PLAN LIMITS FOR 2022

IRS INCREASES RETIREMENT PLAN LIMITS FOR 2022

On November 4, the IRS issued Notice 2021-61 that listed the various changes to retirement plan limits for calendar year 2022. Cost-of-living adjustments were made for employee deferrals, as well as total contribution limits, compensation levels and income ranges for deductibility of IRA contributions. For 2022, the following plan limits were set:

  • Employee deferrals to 401(k), 403(b), most 457 plans and the federal government’s Thrift Savings Plan increased to $20,500 (up from $19,500)
  • Employee deferrals for SIMPLE retirement plans increased from $13,500 to $14,000
  • Total contributions to defined contribution plans were increased to $61,000 (up from $58,000)
  • Annual compensation limit was increased to $305,000 for 2022

Other limits like “catch-up” contributions (for those employees aged 50 years and over) were left unchanged at $6,500 for additional deferrals to 401(k) and 403(b) plans; at $3,000 for SIMPLE retirement plans; and $1,000 for IRAs.

To understand how these changes and many others will impact tax filings and retirement planning for 2022, please contact your UHY accounting professional.

 

11/15/2021

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