IRS Announces 2022 Pension Plan Limits – Most Limits Rise | Locke Lord LLP

The Internal Revenue Service announced cost-of-living adjustments in 2022 to dollar limits for qualifying pension plans and other benefits, and the Social Security Administration announced its own cost-of-living adjustments for 2022. Most dollar limits, including the optional deferral contribution limit for the 401 (k), 403 (b) and 457 (b) plans, the annual compensation limit under 401 (a) (17) and the Maximum annual contribution limit under Article 415 (c) of the Code will increase from 2021 limits. Other limits, such as the dollar limit for catch-up contributions (if 50 or older), will remain unchanged.

PENSION PLAN LIMITS

Limits 2022 2021 limits
401 (k) / 403 (b) / 457 (b) Optional carry-overs $ 20,500 $ 19,500
Catch-up contribution (plans other than SIMPLE plans) $ 6,500 $ 6,500
SIMPLE Plan Employee Carryovers $ 14,000 $ 13,500
Catch-up contributions to the SIMPLE plan $ 3,000 $ 3,000
Maximum annual plan contribution – Defined contribution plans (Article 415 (c)) $ 61,000 $ 58,000
Maximum annual benefit – Defined benefit plans (section 415 (b)) $ 245,000 $ 230,000
Limitation of compensation under section 401 (a) (17) $ 305,000 $ 290,000
Definition of highly paid employee under section 414 (q) $ 135,000 $ 130,000
Compensation of key employees for the heaviest plans $ 200,000 $ 185,000
ESOP limit to determine the maximum account balance subject to the 5-year distribution limit $ 1,230,000 $ 1,165,000
Amount in ESOP dollars used to determine the extension of the 5-year distribution period $ 245,000 $ 230,000

LIMITATIONS OF THE HEALTH AND WELL-BEING REGIME

Health savings account and high deductible limits for the health care plan

Earlier this year, the IRS announced the inflation-adjusted amounts for the health savings account and high-deductible health plans for 2022. The HSA limit for individual / family coverage will increase to 3,650 $ and $ 7,300, respectively for 2022. The Maximum Annual Exit -The out-of-pocket spending limits for high-deductible health plans for individual and family coverage will increase in 2022, but the minimum annual deductible will remain unchanged from the limits. from 2021.

Health savings accounts / HDHP limits

Limits 2022 2021 limits
HSA Contribution – Annual Contribution Limit
Individual coverage $ 3,650 $ 3,600
Family coverage $ 7,300 $ 7,200
Catch-up contributions (55 or over) $ 1,000 $ 1,000
High Deductible Health Plan – Minimum Annual Deductible
Individual coverage $ 1,400 $ 1,400
Family coverage $ 2,800 $ 2,800
High Deductible Health Insurance Plan – Maximum Pocket Limit
Individual coverage $ 7,050 $ 7,000
Family coverage $ 14,100 $ 14,000

SOCIAL SECURITY SALARY BASIS

Social security salary base

Limit 2022 2021 limit
Social Security Salary Base (FICA) $ 147,000 $ 142,800


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