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2021 Retirement Plan Limits

Most of the key plan limits remain unchanged for 2021 from 2020 levels with the notable exception of the combined DC annual contribution limit, which increased to $58,000, and the annual compensation limit increase to $290,000. The ESOP maximum balance limit also increased. Below are the limits for 2019-2021 with changes highlighted. See IRS announcement IR-2020-79 for a complete list of all plan limitation amounts.  

  2019 2020 2021
Elective Deferrals - 401(k), 403(b), and Most 457 Plans $19,000 $19,500 $19,500
Catch-up Contribution $6,000 $6,500 $6,500
DC Plan Combined Annual Contribution Limit $56,000 $57,000 $58,000
Annual Compensation Limit $280,000 $285,000 $290,000
Highly Compensated Employee Threshold $125,000 $130,000 $130,000
Top Heavy Key Employee Dollar Limit $180,000 $185,000 $185,000
       
SIMPLE Plan Contribution Limit $13,000 $13,500 $13,500
SIMPLE Plan Catch-up $3,000 $3,000 $3,000
Defined Benefit Annual Benefit Limit $225,000 $230,000 $230,000
ESOP Maximum Balance Subject to Five-Year Distribution Rule $1,130,000 $1,150,000 $1,165,000
ESOP Amount to Determine Lengthening Five-Year Distribution Period      $225,000 $230,000 $230,000
       
IRA Contribution Limit $6,000 $6,000 $6,000
IRA Catch-Up $1,000 $1,000 $1,000