IRS Increases 2020 401(k) Contribution Limit to $19,500

The Internal Revenue Service (IRS) released 2020 guidelines for pension plans and other retirement-related employee plans, including 401(k) accounts, to reflect cost-of-living adjustments, as follows:

  • Employee contribution limit to 401(k), 403(b) and 457(b) plans for employees under 50: $19,500 (a $500 increase from 2019)
  • Additional “catch-up” contribution limit for participants ages 50 and over: $6,500 (a $500 increase from 2019)
  • Combined employer and employee contribution limit for defined contribution plans: $57,000 (a $1,000 increase from 2019) 

For more information on these and other 2020 guidelines, see the IRS press release or Notice 2019-59.