It’s that time of year again.
The Internal Revenue Service has announced the 2021 retirement plan limits and the Social Security wage bases and rates.
BOTH CONTRIBUTION LIMITS ARE STAYING THE SAME.
The Contribution limit is staying at $19,500, while the Catch-Up provision is staying at $6,500.
Notable changes are:
- The Defined Contribution Maximum from $57,000 to $58,000
- Annual Compensation limit from $285,000 to $290,000
The chart linked shows the maximum benefit and contribution limits for 2021. These new limits become effective January 1, 2021.
We recommend that you confirm with your payroll provider that all of their systems will be updated with these new limits. Specifically confirming that any calculations based on these updated limits will also be updated (such as your match). Feel free to reach out to the Marsh & McLennan Agency Retirement Services team with any questions you may have.