The IRS has announced the cost-of-living adjustments (COLAs) to the dollar limits on benefits and contributions under qualified retirement plans, as well as other items, for tax year 2022.

• The limitation on the exclusion for elective deferrals under §402(g)(1) (e.g., §401(k) and §403(b) plans) increases to $20,500 (from $19,500).
• The limit on annual additions to defined contribution plans under §415(c)(1)(A) increases to $61,000 (from $58,000).
• The limit on the annual benefit under a defined benefit plan contained in §415(b)(1)(A) increases to $245,000 (from $230,000).
• The annual compensation limit under §401(a)(17), §404(l), §408(k)(3)(C), and §408(k)(6)(D)(ii) increases to $305,000 (from $290,000).
• The compensation amount under §408(p)(2)(E) regarding elective deferrals to SIMPLE retirement accounts increases to $14,000 (from $13,500).
• The limitation under §457(e)(15) concerning elective deferrals to deferred compensation plans of state and local governments and tax-exempt organizations (§457(b) plans) increases to $20,500 (from $19,500).
• The limitation under §416(i)(1)(A)(i) concerning the definition of “key employee” in a top-heavy plan increases to $200,000 (from $185,000).
• The limitation under §414(v)(2)(B)(i) for catch-up contributions to §§401(k), 403(b), and 457(b) plans for individuals age 50 or over remains unchanged at $6,500; the limitation under §414(v)(2)(B)(ii) for catch-up contributions to an employer’s SIMPLE plan for individuals age 50 or over remains unchanged at $3,000.
• The limitation used in the definition of “highly compensated employee” under §414(q)(1)(B) increases to $135,000 (from $130,000).
• The annual compensation limit under §401(a)(17) for eligible participants in certain government plans that, under the plan as in effect on July 1, 1993, allowed cost-of-living adjustments to the compensation limit under the plan under §401(a)(17) to be taken into account, increases to $450,000 (from $430,000).
• The compensation amount under §408(k)(2)(C) regarding simplified employee pensions (SEPs) remains unchanged at $650.
• The compensation amount under Treas. Reg. §1.61-21(f)(5)(i), concerning the definition of “control employee” for fringe benefit valuation purposes, increases to $120,000 (from $115,000). The compensation amount under §1.61-21(f)(5)(iii) increases to $245,000 (from $235,000).
• The limit on annual contributions to an Individual Retirement Arrangement, remains unchanged at $6,000. The additional catch-up contribution limit for individuals aged 50 and over is not subject to an annual cost-of-living adjustment and remains $1,000.