As you close out 2019, be sure your payroll software has been set with the correct limits for 457(b) plans for 2019 based on age for your employees. Limits are based on employee AND employer contributions. The 2019 limits for 457(b) plans are:
- $19,000 for participants under 50
- $25,000 for participants age 50 and older (special catch-up* limit: $38,000)
These limits apply for both the pre-tax and the after-tax 457(b) plans. If participants split their contributions between the pre- and after-tax options, the amounts will be combined and must stay within the applicable annual limit.
2020 457(b) contribution limits
The IRS has published retirement plan contribution limits for 2020. Following are the published limits. This information also is posted for employees participants on our website here.
According to IRS requirements for 2020, “a 457(b) plan’s annual contributions and other additions (excluding earnings) to a participant’s account cannot exceed”:
- $19,500 for participants under 50
- $26,000 for participants age 50 and older (special catch-up* limit: $39,000)
* Eligible participants may be able to contribute up to twice the annual limit as special catch-up contributions for three years before the normal retirement age specified in a 457(b) plan. Participants should contact CRA to discuss eligibility if they are interested in special catch-up contributions.