Blue Ridge ESOP Associates Industry News

New Plan Limits for 2021

Posted by Scott J. Freund, QPA, QKC

Nov 24, 2020 2:14:00 PM

New Plan Limits for 2020

On October 26, 2020, the IRS announced cost of living adjustments affecting qualified retirement plans for 2021. Several the limits are unchanged from the limits which were in place for 2020.

Selected Limits




401(k) Elective Deferrals



401(k) Catch Up Deferrals



Annual Defined Contribution Limit (Section 415)*



Annual Compensation Limit **



Highly Compensated Employees

(look-back year calculation)**



Key Employee – Officer Threshold*



Social Security Wage Base



ESOP Threshold Balance for lengthening the 5-year installment period



Amount for lengthening the 5-year ESOP installment period



*Effective for limitation years ending in calendar year

**Effective for plan years beginning in the calendar year

 The Adjusted Gross Income limit for the saver’s credit (also known as the retirement savings contribution credit) for low- and moderate-income workers is $66,000 for married couples filing jointly, up from $65,000; $49,500 for heads of household, up from $48,750; and $33,000 for married individuals filing separately and for singles, up from $32,500.

Topics: IRS, Plan Limits

Experience the Leader in Personalized ESOP & 401(k) Administration

Blue Ridge ESOP Associates can provide everything you need to administer your ESOP, 401(k) or combination ESOP/401(k) plan. Our full service outsourcing, which can include participant on-line services, provides worry-free  assistance for your HR or Benefits staff, leaving them free to concentrate on other responsibilities.

Subscribe to Email Updates

Recent Posts