2020 Benefit Plan Limits

 

401(k) Plan Limits
 

Defined Contribution Plans 2020 2019 Change

Maximum employee elective deferral

$19,500

$19,000

+$500

Employee catch-up contribution (if age 50 or older by year-end) 1

$6,500

$6,000

+$500

Defined contribution maximum limit, all sources (employee + employer) 2

$57,000

$56,000

+$1,000

Defined contribution maximum limit (if age 50 or older by year end); maximum contribution all sources plus catch-up

$63,500

$62,000

+$1,500

Employee compensation limit for calculating contributions

$285,000

$280,000

+$5,000

Key employees' compensation threshold for nondiscrimination testing 3

$185,000

$180,000

+5,000

 

Highly compensated employees' threshold for nondiscrimination testing 4

$130,000

$125,000

+5,000

1 The $6,500 catch-up contribution limit for participants age 50 or older applies from the start of the year for those turning 50 at any time during the year.

2 Total contributions from all sources may not exceed 100% of a participant's compensation.

3 Includes officers of the company sponsoring the plan.

4 For the 2020 plan year, an employee who earns more than $125,000 in 2019 is an HCE. For the 2021 plan year, an employee who earns more than $130,000 in 2020 is an HCE.

​Source: IRS Notice 2019-59.

 

 

HSA and HDHP Limits

Health Savings Accounts (HSAs) and High-Deductible Health Plans (HDHPs)  2020 2019 Change

HSA contribution limit
(employer + employee)

Self-only: $3,550
Family: $7,100

Self-only: $3,500
Family: $7,000

Self-only: +$50
Family: +$100

HSA catch-up contributions
(age 55 or older)

$1,000

$1,000

No change

HDHP minimum deductibles

Self-only: $1,400
Family: $2,800

Self-only: 1,350
Family: $2,700

Self-only: +$50
Family: +$100

HDHP maximum out-of-pocket amounts (deductibles, co-payments and other amounts, but not premiums)

Self-only: $6,900
Family: $13,800

Self-only: $6,750
Family: $13,500

Self-only: +150
Family: +$300

Source: IRS Notice 2019-25.

 

 

 

Health FSA Limits
 

Health Care Flexible Spending Accounts (Health FSAs) and Limited-Scope (Vision/Dental) FSAs

2020

2019

Change

Maximum salary deferral contribution

$2,750

$2,700

+$50

Source: IRS Notice 2019-44.

 

 

 

QSEHRA Limits

Qualified Small Employer Health Reimbursement Arrangements (QSEHRAs)  2020 2019 Change

Maximum payments and reimbursements through the QSEHRA

Self-only: $5,250
Family: $10,600

Self-only: $5,150
Family: $10,450

Self-only: +$100
Family: +$150

Source: IRS Notice 2019-44.

 

Commuter Transit and Parking Limits
 

Qualified Transportation Benefit Tax Exclusion (monthly limits)

2020

2019

Change

Transit passes and van pool services (employer + employee)

$270

$265

+$5

 

Qualified parking

$270

$265

+$5

Source: IRS Notice 2019-44.

 

 

 

Earnings Subject to Social Security Payroll Tax

Social Security (FICA) Payroll Tax

2020

2019

Change

Maximum earnings subject to Social Security 12.4% FICA payroll tax (6.2% paid by employer and 6.2% paid by employee)

$137,700

$132,900

+$4,800

Source: Social Security Administration.