The 2023 IRA and pension plan limitations have been announced. Below are some of the more common amounts for 2023:
- The defined benefit plan limitation is $265,000 (up from $245,000 for 2022).
- The defined contribution plan maximum increases to $66,000 (up from $61,000).
- The annual compensation limit for the calculation of most employer contributions is $330,000 (up from $305,000).
- The Retirement Savers Credit is completely phased out at MFJ = $73,000 (up from $68,000), HH = $54,750 (up from $51,000), and all others = $36,500 (up from $34,000).
- A year of service for SEP coverage remains at $750.
- The maximum elective deferral for §401(k), §403(b), §457, and SARSEPs is $22,500 (up from $20,500 for 2021). The catchup contribution limit for those aged 50 or older as of the end of the year is $7,500 (up from $6,500).
- The maximum elective deferral to SIMPLE plans is $15,500 (up from $14,000). The catch-up maximum is $3,500 (up from $3,000).
- The maximum contribution to IRAs is $6,500 (up from $6,000). The catch-up for IRAs is not subject to annual indexing and remains at $1,000.
- The modified AGI phase-out ranges are $73,000-$83,000 (up from $68,000-$78,000); MFJ = $116,000-$136,000 (up from $109,000-$129,000); and MFJ when the taxpayer is not covered but the spouse is = $218,000-$228,000 (up from $204,000-$214,000).
- Roth IRA AGI phase-out limits increase to $138,000-$153,000 (up from $129,000-$144,000). For MFJ these amounts are $218,000-$228,000 (up from $204,000-$214,000).
- The definition of high compensation for purposes of section 414(q)(1)(B) is $150,000 (up from 135,000).
The IRS Notice also has other pension-related indexed amounts such as key employee, top-heavy, and “control employee” limits.
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