The IRS limits the amount of money that may be contributed to retirement plans. These limits are updated annually. There are two main types of contribution limits to the FCMM Retirement Plan: the overall limit on annual additions and the elective salary deferral limit.
The limit on annual additions, also known as the 415(c) limit, includes employer contributions of related employers plus all salary deferral contributions made to any 403(b) or 401(k) plans in a calendar year. For 2026, this limit is the lesser of $72,000 or 100% of "includible compensation", which the IRS defines as excluding a minister's housing allowance.
The elective salary deferral limit, also known as the 402(g) limit, includes all pre-tax and Roth elective deferrals made to any 403(b) or 401(k) plans in a calendar year. The 2026 salary deferral limit is $24,500. The employee's total elective deferrals to all plans combined cannot exceed the annual deferral limit.
A participant of age 50 or older can make additional age-based catch-up deferral contributions, beyond these limits, of up to $8,000 in 2026. (Higher catch-up provision for ages 60-63: Participants who attain age 60, but are not older than age 63, by the end of the calendar year may contribute up to a higher "super" catch-up limit of $11,250. This amount remains unchanged for 2026.)
Effective in 2026, the IRS has imposed a Roth catch-up requirement on some catch-up contributions -- specifically those made by high income earners who are not ministers. A FICA-taxed employee who earned $150,000 or more in 2025 is not permitted to make pre-tax catch-up contributions in the current year; any catch-ups must be designated as Roth contributions which do not reduce taxable income. This wage qualification does not apply to ministers who are treated properly as SECA-paying dual status employees; they may make catch-up contributions as pre-tax and/or Roth-designated as they choose.
The examples below illustrate some of these limits.
- Example 1:
The Reverend Bill Smith has a cash salary of $15,000 and a $25,000 housing allowance, for a total compensation of $40,000. He does not participate in any retirement programs other than this Plan and his employer makes no contributions to any retirement programs on his behalf. The maximum he may contribute to the Plan is $15,000. Rev. Smith cannot include the housing allowance in determining his maximum contribution amount.
- Example 2:
The Reverend Sam Jones is in the same situation as Rev. Smith except that he has a cash salary of $60,000 and a housing allowance of $15,000, for a total compensation of $75,000. The maximum amount he may contribute to the Plan for 2026 is $24,500 (assuming he is not eligible to make any catch-up contributions).
- Example 3:
The Reverend George Davis has a cash salary of $30,000 and a housing allowance of $25,000, for a total compensation of $55,000. His employer contributes 15% of his compensation* to the retirement plan annually, or $8,250 ($80,000 x 15% = $8,250). The maximum deferral amount he may contribute to the plan in 2026 is $21,750 ($30,000 - $8,250 = $21,750).
- Example 4:
The Reverend Kenneth Roberts turns 62 in 2026. He has a cash salary of $40,000 and a housing allowance of $30,000, for a total compensation of $70,000. He does not participate in any retirement programs other than this Plan and his employer makes no contributions to any retirement programs on his behalf. The maximum deferral amount he may contribute to the plan in 2026 is $35,750. This deferral amount is allowed by applying both the regular salary deferral limit ($24,500) and the "super" catch-up limit for those who attain age 60 but are not older than age 63 in 2026 ($11,250).
*Note, the employer must use total compensation (salary plus housing allowance) when calculating a contribution amount based on a percentage rate. Includible compensation which excludes housing allowance only applies when determining an individual’s contribution limits.
