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IRS Announces 2022 Limitations for Qualified Retirement Plans: Prices Aren’t the Only Thing Going Up
Friday, November 5, 2021

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

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