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Release Date: 
Tuesday, November 19, 2019

2020 maximum allowable contribution for 403(b), 457(b) accounts

Drawing of a hand with money

The following message is provided courtesy of the TSA Consulting Group.

The latest IRS information concerning maximum allowable contribution limits indicates that the normal limit has been increased for calendar year 2020.

MAC Limits for 2020

The normal calendar year limit for 403(b), 457(b) and 401(k) plans will increase from $19,000 to $19,500 for 2020.
The age-based additional amount (age 50 by 12/31/2020) will increase from $6,000 to $6,500 for 2020.
Any other catch-up options that may be applicable to your plan(s) remain unchanged.

Examples

All employees, regardless of age or years of service, may contribute up to $19,500 to their 403(b), 457(b) or 401(k) account(s) in 2020. The limit is coordinated for 403(b) and 401(k) accounts. 457(b) accounts are not coordinated with other plans.

Employees who will turn 50 years old by Dec. 31, 2020 may contribute an additional $6,500 to 403(b), 457(b) and/or 401(k) account(s) in 2020. This limit is coordinated for 403(b) and 401(k) accounts.

IRC §415 Limit

The overall employee and employer contribution limit for 401(a), 401(k) and 403(b) plans increases by $1,000 to a total of $57,000 effective Jan. 1, 2020. This overall defined contribution limit is of special importance to those plan sponsors with Special Pay Plans that are designed to accommodate accumulated leave payments.

For questions or more information, contact TSA at 888-777-5827.