The IRS, in Notice 2022-55 has announced increased 401(k) plan limits for 2023. The increases are larger than usual due to inflation. Here is what you need to know:
- The 401(k) deferral limit is increased to $22,500 from $20,500. Note this increase applies to 403(b) plans as well.
- The total contribution limit for a defined contribution plan is increased to $66,000 from $61,000.
- The catch-up contribution limit for individuals age 50 or over is increased to $7,500 from $6,500.
- Compensation which can be considered under a qualified plan is increased to $330,000 from $305,000.
- The limit for Highly Compensated Employees is increased to $150,000 from $135,000.
If you have questions about 401(k) plan limits, please contact a member of Carmody’s Labor & Employment group.