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IRS Raises 401(k) Contribution Limits For 2022

Date: November 12, 2021

 

In an ongoing effort to provide workers with the opportunity to save more for retirement, individual workers will be able to contribute up to $20,500 to their 401(k) retirement accounts in 2022, up from $19,500 in 2021 and 2020, the IRS announced this month.

The change is part of the tax code’s annual inflation adjustments and does not require Congressional action to implement. While the benefits of higher limits go mainly to the small fraction of wealthy people who are able to max out their contributions, knowledge is power.  For those of us who may be in a position to do so, we are pointing out the opportunity.

Catch-up contributions to retirement accounts for those age 50 and up will remain unchanged at $6,500. Including their regular contributions, people aged 50 and up will be able to set aside for retirement up to $27,000 annually.

 

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