2020 Solo 401(k) Contribution Limits
Section 415 of the Internal Revenue Code (the Code) provides for dollar limitations on benefits and contributions under qualified retirement plans. Section 415(d) requires that the Secretary of the Treasury annually adjust these limits for cost-of-living increases. Other limitations applicable to deferred compensation plans are also affected by these adjustments under § 415. Under § 415(d), the adjustments are to be made under adjustment procedures similar to those used to adjust benefit amounts under § 215(i)(2)(A) of the Social Security Act.
The Internal Revenue Service today announced that employees in 401(k) plans will be able to contribute up to $19,500 in 2020.
Highlights of changes for 2020
The contribution limit for employees who participate in 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan is increased from $19,000 to $19,500.
2020 Contribution Breakdown for Solo 401(k) Plans
Employee Contribution Limit = $19,500
The catch-up contribution limit for owner-only aged 50 and over = $6,500
The total contribution limit for 2020 = $57,000 or $63,000 if age 50 or over.
Section 415 of the Internal Revenue Code (the Code) provides for dollar limitations on benefits and contributions under qualified retirement plans. Section 415(d) requires that the Secretary of the Treasury annually adjust these limits for cost-of-living increases. Other limitations applicable to deferred compensation plans are also affected by these adjustments under § 415. Under § 415(d), the adjustments are to be made under adjustment procedures similar to those used to adjust benefit amounts under § 215(i)(2)(A) of the Social Security Act.
The Internal Revenue Service today announced that employees in 401(k) plans will be able to contribute up to $19,500 in 2020.
Highlights of changes for 2020
The contribution limit for employees who participate in 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan is increased from $19,000 to $19,500.
2020 Contribution Breakdown for Solo 401(k) Plans
Employee Contribution Limit = $19,500
The catch-up contribution limit for owner-only aged 50 and over = $6,500
The total contribution limit for 2020 = $57,000 or $63,000 if age 50 or over.