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IRS Announces 2022 Limitations for Qualified Retirement Plans: Prices Aren’t the Only Thing Going Up

On November 4, 2021, the Internal Revenue Service (IRS) released the 2022 dollar limitations that apply to tax-qualified retirement plans. With few exceptions, the 2022 limitations published in Notice 2021-61 have been adjusted upwards. Catch-up contribution maximums and the compensation amount for simplified employee pensions (SEPs) have not changed. The table below lists key 2022 amounts that affect tax-qualified retirement plans, compared to the current amounts.

Internal Revenue Code (IRC) or Regulation Section

2022

2021

Defined benefit plan limit: IRC § 415(b)(1)(A)

$245,000

$230,000

Defined contribution plan limit: IRC § 415(c)(1)(A)

$61,000

$58,000

Elective deferral exclusion limitation: IRC § 402(g)(1)

$20,500

$19,500

Annual compensation limit:
IRC §§ 401(a)(17) and 404(l)

$305,000

$290,000

Annual simplified employee pension (SEP) compensation limit: IRC § 408(k)(3)(C)

$305,000

$290,000

Key employee dollar limitation in top-heavy plans: IRC § 416(i)(1)(A)(i)

$200,000

$185,000

Employee stock ownership plan (ESOP) maximum account balance: IRC § 409(o)(1)(C)(ii)

$1,230,000

$1,165,000

ESOP dollar amount to determine lengthening of five-year distribution period: IRC § 409(o)(1)(C)(ii)

$245,000

$230,000

Highly compensated employee limitation: IRC § 414(q)(1)(B)

$135,000

$130,000

Catch-up contributions limitation:
IRC § 414(v)(2)(B)(i)

$6,500

$6,500

Savings incentive match plan for employees (SIMPLE) catch-up contributions limitation:
IRC § 414(v)(2)(B)(ii)

$3,000

$3,000

SEP compensation amount: IRC § 408(k)(2)(C)

$650

$650

SIMPLE contribution limit: IRC § 408(p)(2)(E)

$14,000

$13,500

Deferral limitation: IRC § 457(e)(15)

$20,500

$19,500

Social Security tax wage base

$147,000

$142,800

© 2022, Ogletree, Deakins, Nash, Smoak & Stewart, P.C., All Rights Reserved.National Law Review, Volume XI, Number 309
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About this Author

Catherine Reesse, Ogletree Deakins Law Firm, Indianapolis, Labor and Employment Law Attorney
Shareholder

Ms. Reese concentrates her practice in employee benefits.  She works with employers to design, establish and administer qualified retirement plans (defined contribution, defined benefit, cash balance), welfare benefit plans, and nonqualified deferred compensation plans. 

She assists clients in complying with statutory and regulatory requirements for reporting and disclosure, testing, and corrections for benefit plans, as well as assisting with IRS, DOL and PBGC filings, audits, and queries.  Ms. Reese also works on benefits issues involved in...

317-916-2536
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