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Retirement Plan Contribution Limits (2021): Overall and Deferral Limits

Authored by: Jerry Rich
Date: November 17, 2020
Overall Limit: $58,000 or 100% of includible compensation. Salary Deferral Limit: $19,500. Additional catchup limit after age 50: $6,500

There are two types of contribution limits to the FCMM Retirement Plan: the overall limit and the salary deferral limit. The IRS has published the limits for 2021:

The overall limit includes both employer and salary deferral contributions to all 403(b) and 401(k) plans. The 2021 year overall contribution limit is the lesser of $58,000 (increased from $57,000 in 2020) or 100% of includible compensation which excludes a housing allowance. This overall limit is also known as the 415(c) limit.

The salary deferral limit covers all pre-tax and Roth deferrals to all 403(b) and 401(k) plans. The unchanged 2021 annual limit is $19,500. This salary deferral limit is also known as the 402(g) limit.

A participant over age 50 can make catch-up deferral contributions, in addition to these limits, of up to $6,500.

(Please note: These limits apply only to the maximum amount for contribution. The employer's calculation of percentage rate for all contributions to FCMM is based on the salary plus housing allowance and any other amounts that are excludable from gross income under the IRS Code.)