2021 End of Year Plan Sponsor “To Do” List (Part 2) Annual Cost of Living Adjustments

Snell & Wilmer

As is tradition, we are happy to present our End of Year Plan Sponsor “To Do” Lists. We are publishing our “To Do” Lists in four separate Employee Benefits Updates. Part 1 covered year-end health and welfare plan issues. This Part 2 describes annual cost-of-living increases. Parts 3 and 4 will cover qualified plan and executive compensation issues. Each Employee Benefits Update provides a “To Do” List of items to consider taking action on before the end of 2021 or in early 2022. As always, we appreciate your relationship with Snell & Wilmer and hope that these “To Do” Lists can help focus your efforts over the next few months.

Qualified Retirement Plan Dollar Limits
 
2020
2021
2022
Limit on Section 401(k) deferrals
(Section 402(g))
$19,500
$19,500
$20,500
Dollar limitation for
catch-up contributions
(Section 414(v)(2)(B)(i))
$6,500
$6,500
$6,500
Limit on deferrals for government and tax-exempt organization deferred compensation plans
(Section 457(e)(15))
$19,500
$19,500
$20,500
Annual benefit limitation for a defined benefit plan
(Section 415(b)(1)(A))
$230,000
$230,000
$245,000
Limitation on annual contributions to a defined contribution plan
(Section 415(c)(1)(A))
$57,000
$58,000
$61,000
Limitation on compensation
that may be considered by
qualified retirement plans
(Section 401(a)(17))
$285,000
$290,000
$305,000
Dollar amount for the definition of highly compensated employee
(Section 414(q)(1)(B))
$130,000
$130,000
$135,000
Dollar amount for the definition of a key employee in a top-heavy plan
(Section 416(i)(1)(A)(i))
$185,000
$185,000
$200,000
Dollar amount for determining the maximum account balance in an ESOP subject to a five-year distribution period
(Section 409(o)(1)(C)(ii))
$1,150,000
$1,165,000
$1,230,000
SIMPLE retirement
account limitation
(Section 408(p)(2)(E))
$13,500
$13,500
$14,000
Social Security Taxable Wage Base
$137,700
$142,800
$147,000
Health and Welfare Plan Dollar Limits
 
2020
2021
2022
Annual Cost Sharing Limit
(self-only coverage)
$8,150
$8,550
$8,700
Annual Cost Sharing Limit
(other than self-only coverage)
$16,300
$17,100
$17,400
HDHP Out-of-Pocket Maximum
(self-only coverage)
$6,900
$7,000
$7,050
HDHP Out-of-Pocket Maximum
(family coverage)
$13,800
$14,000
$14,100
Annual HDHP Deductible
(self-only coverage)
Not less than $1,400
Not less than $1,400
Not less than $1,400
Annual HDHP Deductible
(family coverage)
Not less than $2,800
Not less than $2,800
Not less than $2,800
Maximum Annual
HSA Contributions
(self-only coverage)
$3,550
$3,600
$3,650
Maximum Annual
HSA Contributions
(family coverage)
$7,100
$7,200
$7,300
Maximum HSA Catch-Up Contribution
$1,000
$1,000
$1,000
Health Flexible Spending
Account Maximum
$2,750
$2,750
$2,850

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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