The IRS has released the 2020 cost-of-living adjustments for limits on employee benefits with some adjustments to the 2020 rates including minor increases to the maximum elective deferrals, the maximum benefits allowed under Code Section 415, maximum compensation used in determining benefits, and the taxable wage base. Below is an updated chart on 2020 limits.
Limits for 2020 – Qualified Plans
|
Limitation
|
2019
|
2020
|
|
Elective Deferrals (401(k) and 403(b) pre-tax contributions; 457(b), 402(g)(3))
|
$19,000
|
$19,500
|
|
Catch-up Contributions – 401(k), 403(b), 457(b), SARSEP plans
|
$6,000
|
$6,500
|
|
Highly Compensated Employee (HCE) – 414(q)
|
$125,000
|
$130,000
|
|
Annual Compensation Limit – 401(a)(17), 404(l), 408(k)(3)(C), 408(k)(6)(D)(ii)
|
$280,000
|
$285,000
|
|
Key employee – 416(i)(1)(A)(i), top heavy and 409A specified employee
|
$180,000
|
$185,000
|
|
Defined Contribution Plan total annual contributions – 415(c)
|
$56,000
|
$57,000
|
|
Defined Benefit Plan Maximum benefit – 415(b)
|
$225,000
|
$230,000
|
|
ESOP – for determining the length of the general five-year distribution period
|
$225,000
|
$230,000
|
|
ESOP – maximum account balance subject to five-year distribution period
|
$1,130,000
|
$1,150,000
|
Limits for 2020 – Tax Withholding Wage Base
|
Limitation
|
2019
|
2020
|
|
Taxable Wage Base
|
$132,900
|
$137,700
|
Limits for 2020 – High Deductible Plans, Health Savings Account and FSAs
|
Limitation
|
2019
|
2020
|
|
High Deductible health plan – IRS limits self/family
-annual deductible –minimum
-out of pocket expenses (HSA) – maximum
|
$1,350/$2,700
$6,750/$13,500
|
$1,400/$2,800
$6,900/$13,800
|
|
HSA Contribution limit – individual/family
|
$3,500/$7,000
|
$3,550/$7,100
|
|
HSA Contribution catch-up
|
$1,000
|
$1,000
|
|
FSA (flexible spending account – health)
|
$2,700
|
$2,750
|
|
FSA (dependent care account)
|
$5,000
|
$5,000
|
|
Out of pocket expenses (ACA) -PHSA §2707(b) maximum (in-network essential health benefits for non-grandfathered plans)
- Self Only
- Embedded Individual Max within Family Coverage
- Family
|
$7,900
$7,900
$15,800
|
$8,150
$8,150
$16,300
|
Limits for 2020 – Affordable Care Act
|
Limitation
|
2019
|
2020
|
|
ACA affordability safe harbor
|
9.86%
|
9.78%
|
Penalties for 2020 – Affordable Care Act
|
Penalty
|
2019
|
2020
|
|
No Offer of Coverage
|
$2,500
|
$2,570
|
|
Offer of coverage lacks minimum value or affordability
|
$3,750
|
$3,860
|
Limits for 2020 – Qualified Transportation Fringe Benefit
|
Limitation
|
2019
|
2020
|
|
Transit pass, van pool
|
$265
|
$270
|
|
Qualified Parking
|
$265
|
$270
|
PBGC Premiums for Defined Benefit Pension Plans – 2020
|
Premium
|
2019
|
2020
|
|
Flat rate per participant
|
$80
|
$83
|
|
Variable rate for $1,000 of unfunded vested benefits
|
$43
|
$45
|
|
Per Participant Variable Cap
|
$541
|
$561
|
