James D. Lynch
IRS Announces Higher Retirement Contribution Limits For 401(k)s But Not IRAs
The Internal Revenue Service announced that the amount individuals can contribute to their 401(k) plans will increase to $20,500 in 2022, up from $19,500 for 2021 and 2020. Contribution limits for 403(b), most 457 plans, and the federal government's Thrift Savings Plan also increase to $20,500. The catch-up contribution limit for employees aged 50 and over remains unchanged at $6,500. Therefore, participants who are 50 and older can contribute up to $27,000 starting in 2022.
The amount individuals can contribute to their SIMPLE retirement accounts will increase from $13,500 to $14,000. The catch-up contribution limit for employees aged 50 and over who participate in SIMPLE plans remains unchanged at $3,000.
The 2022 limit on annual contributions to an IRA remains unchanged at $6,000. The IRA catch-up contribution limit for individuals aged 50 and over remains $1,000.