2022 Employee Benefit Plan Limits Announced by IRS

Nelson Mullins Riley & Scarborough LLP

The IRS has released the 2022 cost-of-living adjustments for limits on employee benefits with some adjustments to the 2022 rates including minor increases to the maximum contributions allowed under Code Section 415 for defined contribution plans (e.g. 401(k)), maximum compensation used in determining benefits, and the taxable wage base. Below is an updated chart on the 2022 limits.

Limits for 2022 – Qualified Plans

Limitation

2022

2021

Change?

Elective Deferrals (401(k) and 403(b)) Pre-Tax Contributions; 457(b), 402(g)(3))

$20,500

$19,500

Yes

Catch-Up Contributions – 401(k), 403(b), 457(b), SARSEP Plans

$6,500

$6,500

No

Highly Compensated Employee (HCE) – 414(q)

$135,000

$130,000

Yes

Annual Compensation Limit – 401(a)(17), 404(l), 408(k)(3)(C), 408(k)(6)(D)(ii)

$305,000

$290,000

Yes

Key Employee – 416(i)(1)(A)(i), Top-Heavy and 409A Specified Employee

$200,000

$185,000

Yes

Defined Contribution Plan – Total Annual Contributions – 415(c)

$61,000

$58,000

Yes

Defined Benefit Plan – Maximum Benefit – 415(b)

$245,000

$230,000

Yes

ESOP – Determining the Length of the General Five-Year Distribution Period

$245,000

$230,000

Yes

ESOP – Maximum Account Balance subject to Five-Year Distribution Period

$1,230,000

$1,165,000

Yes

Limits for 2022 – Tax Withholding Rates

Limitation

2022

2021

Change?

Taxable Wage Base

$147,000

$142,800

Yes

Limits for 2022 – High Deductible Plans, Health Savings Account and FSAs

--> Scroll to see full table data

Limitation

2022

2021

Change?

High Deductible Health Plan – IRS Limits (Self/Family)

  • Annual Deductible – Minimum
  • Out-of-Pocket Expenses (HSA) – Maximum
  • $1,400/$2,800
  • $7,050/$14,100
  • $1,400/$2,800
  • $7,000/$14,000
 

HSA Contribution Limit (Individual/Family)

$3,650/$7,300

$3,600/$7,200

Yes

HSA Contribution Catch-Up Limit

$1,000

$1,000

No

Flexible Spending Account (FSA) – Health Care – Employee Contribution

$2,850

$2,750

Yes

Flexible Spending Account (FSA) – Health Care – Maximum Carryover

$570

$550

Yes

Flexible Spending Account (FSA) – Dependent Care – Employee Contribution

$5,000

$5,000

No

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
  • $8,700
  • $8,700
  • $17,400
  • $8,550
  • $8,550
  • $17,100
  • Yes 
  • Yes
  • Yes
--> Scroll to see full table data

Limits for 2021 – Affordable Care Act

Limitation

2022

2021

Change?

ACA Affordability Safe-Harbor

9.61%

9.83%

Yes

Limits for 2022 – Qualified Transportation Fringe Benefit

Limitation

2022

2021

Change?

Transit Pass, Van Pool

$280

$270

Yes

Qualified Parking

$280

$270

Yes

Penalties for 2022 – Affordable Care Act

Penalty

2022

2021

Change?

No Offer of Coverage

$2,750

$2,700

Yes

Offer of Coverage Lacks Minimum Value or Affordability

$4,120

$4,060

Yes

PBGC Premiums for Defined Benefit Pension Plans – 2022

Premium

2022

2021

Change?

Flat Rate (Per Participant)

$88

$86

Yes

Variable Rate for $1,000 of Unfunded Vested Benefits

$48

$46

Yes

Per Participant Variable Cap

$598

$582

Yes

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.

© Nelson Mullins Riley & Scarborough LLP | Attorney Advertising

Written by:

Nelson Mullins Riley & Scarborough LLP
Contact
more
less

Nelson Mullins Riley & Scarborough LLP on:

Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
- hide
- hide

This website uses cookies to improve user experience, track anonymous site usage, store authorization tokens and permit sharing on social media networks. By continuing to browse this website you accept the use of cookies. Click here to read more about how we use cookies.