2021 Retirement Contribution Limits – Most Popular No Changes!

With 2019 Taxes delayed filing to mid year this year 2020, it seems like tax season was a constant over the last 4-6 quarters. Add to that, there was a COLA (Cost of Living Adjustment) from 2019 to 2020 but not very many changes from this year, 2020 and next tax year 2021 and it seems like a puzzle.

Not to worry, here are the few changes from 2020 to 2021, again the most popular (bolded) by a long shot had very little adjustments

Limits on Benefits and Contributions20212020
401(k), 403(b), and 457 Plan Elective Deferrals$19,500$19,500
Defined Contribution Plans$58,000$57,000
Defined Benefit Plans$230,000$230,000
SIMPLE Plan Elective Deferrals$13,500$13,500
IRA$6,000$6,000
ROTH$6,000$6,000
“Highly Compensated” Definition$130,000$130,000
“Key Employee” Definition
Officer$185,000$185,000
1% Owner$150,000$150,000
Security Taxable Wage Base$142,800$137,700
Catch Up Contributions Age 50 And Older
401(k), 403(b), and 457 Plans$6,500$6,500
SIMPLE Plans$3,000$3,000
IRA$1,000$1,000
ROTH$1,000$1,000
Source https://definiti-llc.com/ and IRS.Gov/Retirement

Note, there are limitations on certain deductions from above as well as income oriented phase outs, please check with your tax professional for your specific sitiation.

Have a Great “New Deferral Limits” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

jkfinancialinc

street-cents

What are your thoughts ??

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s