IRS raises 2020 401(k) contribution limit to $19,500

IRS raises 2020 401(k) contribution limit to $19,500
The limit on contributions to IRAs is unchanged at $6,000.
NOV 06, 2019
On Wednesday, the Internal Revenue Service announced cost-of-living adjustments for 2020 to its limits on contributions to retirement plans. The agency's limit on annual employee contributions to 401(k)s, 403(b)s, most 457 plans and the federal government's Thrift Savings Plan will rise to $19,500 next year, up from $19,000 in 2019 and $18,500 in 2018. Its limit on contributions to individual retirement accounts is unchanged at $6,000. [More: 5 reasons to keep some funds in traditional IRAs, even for Roth IRA lovers]​ The limit on catch-up contributions to IRAs for those 50 and older is unchanged at $1,000 annually, but the cap on catch-up contributions for those 50 and older to 401(k)s and other employee plans will rise to $6,500 next year from $6,000 in 2019. [Recommended video: Ed Slott: Share these two planning ideas before 2019 ends]​ The agency also increased the income ranges at which individuals are eligible to make deductible contributions to IRAs, to contribute to Roth IRAs and to claim the savers' credit. [More: Funding an HSA with an IRA] Investing in profitability, performance and people: Register for our Top Advisory Firm Summit. ​ ​

Latest News

New York Dems push for return of tax on stock sales
New York Dems push for return of tax on stock sales

The looming threat of federal funding cuts to state and local governments has lawmakers weighing a levy that was phased out in 1981.

Human Interest and Income Lab streamline workflows for retirement-focused advisors
Human Interest and Income Lab streamline workflows for retirement-focused advisors

The fintech firms' new tools and integrations address pain points in overseeing investment lineups, account monitoring, and more.

Buy or sell Canada? Wealth managers watch carefully as Canadians head to the polls
Buy or sell Canada? Wealth managers watch carefully as Canadians head to the polls

Canadian stocks are on a roll in 2025 as the country prepares to name a new Prime Minister.

Carson, Lido strengthen RIA networks with bicoastal deals
Carson, Lido strengthen RIA networks with bicoastal deals

Carson is expanding one of its relationships in Florida while Lido Advisors adds an $870 million practice in Silicon Valley.

Goldman gets shareholder backing on $80M executive bonus packages
Goldman gets shareholder backing on $80M executive bonus packages

The approval of the pay proposal, which handsomely compensates its CEO and president, bolsters claims that big payouts are a must in the war to retain leadership.

SPONSORED Compliance in real time: Technology's expanding role in RIA oversight

RIAs face rising regulatory pressure in 2025. Forward-looking firms are responding with embedded technology, not more paperwork.

SPONSORED Advisory firms confront crossroads amid historic wealth transfer

As inheritances are set to reshape client portfolios and next-gen heirs demand digital-first experiences, firms are retooling their wealth tech stacks and succession models in real time.