Changes for 2020
The I.R.S. increased the annual contribution limits on IRAs, 401(k)s, and other widely used retirement plan accounts for 2020. Here’s a quick look at the changes.
*As of January 1st, 2020, you can put up to $6,000 in any type of IRA, for both tax years 2019 and 2020. The limit is $7,000 if you will be 50 or older at any time in 2020.1,2
*Annual contribution limits for 401(k)s, 403(b)s, the federal Thrift Savings Plan, and most 457 plans also get a $500 boost for tax years 2019 and 2020. The new annual limit on contributions is $19,500. If you are 50 or older at any time in 2020, your yearly contribution limit for one of these accounts is $26,000.1,2
*Are you self-employed, or do you own a small business? You may have a solo 401(k) or a SEP IRA, which allows you to make both an employer and employee contribution. The ceiling on total solo 401(k) and SEP IRA contributions rises $1,000 in 2020, reaching $57,000.3
*If you have a SIMPLE retirement account, next year’s contribution limit is $13,500, up $500 from the previous limit. If you are 50 or older in 2020, your annual SIMPLE plan contribution cap is $16,500.3
*Yearly contribution limits have also been set a bit higher for Health Savings Accounts (which may be used to save for retirement medical expenses). The 2020 limits: $3,550 for individuals with single medical coverage and $7,100 for those covered under qualifying family plans. If you are 55 or older next year, those respective limits are $1,000 higher.4
What does this mean for you? Be sure that you are fully maximizing your IRA contributions for both tax years 2019 and 2020. You have until April 15, 2020 to contribute the maximum amount for 2019. Not sure if you are? Contact us! Call us at 866-358-4441or email us at info@creekmurwealth.com .
Have an employer sponsored retirement plan and not sure what you can do to maximize your contributions? We have a program for you! Boost your retirement plan with an analysis from Creekmur Wealth Advisors! Click for a risk tolerance estimator to start your financial analysis today.
Small business owners: be sure you are up to date with the new regulations on solo 401(k)s or SEP IRAs by contacting your local Creekmur Wealth Advisor. We specialize in helping small businesses grow True Wealth for both the employer and employee!
If you don’t have a long-range investment strategy, talk to one of our qualified financial professionals today. 
Citations.
1 - irs.gov/retirement-plans/plan-participant-employee/retirement-topics-ira-contribution-limits [11/8/19]
2 - irs.gov/newsroom/401k-contribution-limit-increases-to-19500-for-2020-catch-up-limit-rises-to-6500 [11/6/19]
3 - forbes.com/sites/ashleaebeling/2019/11/06/irs-announces-higher-2020-retirement-plan-contribution-limits-for-401ks-and-more/ [11/6/19]
4 - cnbc.com/2019/06/03/these-are-the-new-hsa-limits-for-2020.html [6/4/19]
