ARTICLE
20 November 2020

IRS Announces Cost Of Living Adjustments For Dollar Limitations Under Pension Plans And Other Retirement-Related Matters

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Chamberlain, Hrdlicka, White, Williams & Aughtry

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Chamberlain, Hrdlicka, White, Williams & Aughtry
The IRS announced the cost of living adjustments for dollar limitations under pension plans and other retirement-related matters.
United States Employment and HR

The IRS announced the cost of living adjustments for dollar limitations under pension plans and other retirement-related matters. See Notice 2020-79, https://www.irs.gov/pub/irs-drop/n-20-79.pdf.

In IR-2020-244, https://content.govdelivery.com/accounts/USIRS/bulletins/2a7d379, also provides dollar limitation cost of living adjustments for Both IRAs and pension plans, as well.

In Revenue Procedure 2020-45 the IRS announced the inflation adjustments that will apply to various fringe benefits in 2021. https://www.irs.gov/pub/irs-drop/rp-20-45.pdf

Unsurprisingly, most of our dollar limits go unchanged as the cost of living adjustments are impacted by economic factors. Of note, the annual compensation limit under §§ 401(a)(17), 404(l), 408(k)(3)(C), and 408(k)(6)(D)(ii) is increased from $285,000 to $290,000.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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