Retirement Plan Deduction Adjustments

January 2, 2020 | by John F. Leone

The 2020 cost of living adjustments for retirement plans have been released including:

  1. The amount employees can contribute to 401(k) plans has increased from $19,000 to $19,500 in 2020.

  2. The annual amount that can be contributed to a Simple plan has increased from $13,000 to $13,500.

  3. The amount of catch-up contributions to 401(k), 403(b),457(b) and SEPS for workers over age 50 increases from $6,000 to $6,500.

The increase in deferral amounts may provide opportunities for income tax savings and the ability to save more money for retirement.

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