IRS 2020 Inflation Adjustments for Pension Plans, Retirement Accounts by Mike Grinnan CPA

The IRS has released the 2020 cost-of-living adjustments (COLAs) for pension plan dollar limitations, and other retirement-related provisions.

Highlights of 2020 Changes

IRA Contribution Limits:

• The annual limit on contributions to an IRA remains unchanged at $6,000.
• For individuals age 50 and over, the IRA “catch-up” contribution limit remains $1,000 (this limit is not subject to an annual COLA adjustment).

The contribution limit for employees who take part in 401(k) plans, 403(b) plans, most 457 plans, and the federal government’s Thrift Savings Plan, has increased to 

• $19,500
• Employees age 50 and over who participate in these plans can make a “catch-up” contribution for 2020 of up to $6,500.