401(k) Plan limits
| Defined contribution plans | 2021 | 2020 | Switch |
|
Maximum employee’s optional adjournment |
$ 19,500 |
$ 19,500 |
no change |
|
Employee catch-up contribution (if 50 or over at the end of the year) 1 |
$ 6,500 |
$ 6,500 |
no change |
|
Maximum optional deferral of the employee plus catch-up contribution (if 50 or over at the end of the year) |
$ 26,000 |
$ 26,000 |
no change |
|
Defined contribution ceiling, all sources (employee + employer) |
$ 58,000 |
$ 57,000 |
+ 1000 $ |
|
Maximum limit of defined contributions (if 50 years or more at the end of the year); maximum contribution from all sources plus catch-up |
$ 64,500 |
$ 63,500 |
+ 1000 $ |
|
Employee compensation limit for calculating contributions |
$ 290,000 |
$ 285,000 |
+ $ 5,000 |
|
Pay threshold for key employees for non-discrimination testing 3 |
$ 185,000 |
$ 185,000 |
no change |
|
Highly Paid Threshold for Non-Discrimination Testing 4 |
$ 130,000 |
$ 130,000 |
no change |
Source: IRS Notice 2020-79.
HSA and HDHP limits
| Health Savings Accounts (HSA) and High Deductible Health Plans (HDHP) | 2021 | 2020 | Switch |
|
HSA contribution limit |
Self-only: $ 3,600
|
Self-only: $ 3,550 Family: $ 7,100 |
Self-only: + $ 50 Family: + $ 100 |
|
HSA catch-up contributions |
$ 1,000 |
$ 1,000 |
no change |
|
HDHP minimum deductibles |
Self-only: $ 1,400
|
Self-only: 1,400 Ffamily: $ 2,800 |
no change no change |
|
Maximum HDHP reimbursable amounts (deductibles, co-payments and other amounts, but not premiums) |
Self-only: $ 7,000
|
Self-only: $ 6,900 Family: $ 13,800 |
Auto-only: +100 Family: + $ 200 |
Source: IRS Notice 2020-32.
FSA Health Limits
|
Flexible Healthcare Expense Accounts (Health FSA) and Limited Scope FSA (Vision / Dental) |
2021 |
2020 |
Switch |
|
Maximum salary deferral |
$ 2,750 |
$ 2,750 |
no change |
|
Maximum rollover amount |
$ 550 |
Raised to $ 550 from $ 500 mid-year 1 |
no change from the adjusted amount |
1 IRS Notice 2020-33, published May 12, 2020.
Source: IRS Revenue Procedure 2020-45.
Update: The Consolidated Appropriations Act promulgated at the end of 2020 allows employers who sponsor health care or dependent care ASPs to allow participants to carry over any unused amounts to these accounts from 2020 to 2021 and 2021 to 2022.
QSEHRA
Limits
| Small Skilled Employer Health Reimbursement Arrangements (QSEHRA) | 2021 | 2020 | Switch |
|
Maximum Payments and Refunds Through QSEHRA |
Self-only: $ 5,300
|
Self-only: $ 5,250 Family: $ 10,600 |
Self-only: + $ 50 Family: + $ 100 |
Source: IRS Revenue Procedure 2020-45.
Public transit and parking limits
|
Tax exemption on eligible transportation benefits (monthly limits) |
2021 |
2020 |
Switch |
|
Passes and van pool services (employer + employee) |
$ 270 |
$ 270 |
no change |
|
Qualified parking |
$ 270 |
$ 270 |
no change |
Source: IRS Revenue Procedure 2020-45.
Income subject to social security payroll tax
|
Social Security Payroll Tax (FICA) |
2021 |
2020 |
Switch |
|
Maximum salary subject to FICA payroll tax 12.4% (6.2% paid by employer and 6.2% paid by employee) |
$ 142,800 |
$ 137,700 |
+ $ 5,100 |
Source: Social security administration.
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