The IRS released the 2022 cost of living adjustments (IRS Notice 2021-61) applicable to defined benefit and defined contribution plans (highlights below).
| | 2022 | 2021 |
| Defined benefit plan annual limit | $245,000 | $230,000 |
| Defined contribution plan annual limit | $61,000 | $58,000 |
| Elective deferral limit for purposes of cash or deferred arrangements (401(k) plans) and tax-sheltered annuities (403(b) plans) | $20,500 | $19,500 |
| Maximum deferral limit for 457 plans | $20,500 | $19,500 |
| >Age 50 catch-up contribution limit to 401(k), 403(b) or 457(b) plans | $6,500 | $6,500 |
| Maximum deferral limit for SIMPLE plans | $14,000 | $13,500 |
| >Age 50 catch-up contribution limit to SIMPLE plans | $3,000 | $3,000 |
| Minimum compensation considered in determining eligibility for a SEP (simplified employee pension) | $650 | $650 |
| Threshold for highly compensated employee (HCE) | $135,000 | $130,000 |
| Key employee compensation limit for top heavy plan purposes | $200,000 | $185,000 |
| Annual compensation limit | $305,000 | $290,000 |
The information contained in this Benefit Beat is not intended to be legal, accounting, or other professional advice, nor are these comments directed to specific situations. This information is provided as general guidance and may be affected by changes in law or regulation. This information is not intended to replace or substitute for accounting or other professional advice. You must consult your own attorney or tax advisor for assistance in specific situations. This information is provided as-is, with no warranties of any kind. CBIZ shall not be liable for any damages whatsoever in connection with its use and assumes no obligation to inform the reader of any changes in laws or other factors that could affect the information contained herein.