2021 retirement plan contributions have been released. While the majority of limits remain unchanged, there are a few updates to note. Here’s a summary!
401(k)s. The $19,500 limit remains unchanged as does the $6,500 catch up contribution for anyone over age 50. However, the overall limit increases from $57,000 to $58,000.
IRAs. Limits stay at $6,000 for Traditional and Roth IRAs or $7,000 if you are 50 or older in 2021.
Roth IRAs Income Phase-Out. Though limits didn’t increase, you can earn a little more and still make a contribution. For 2021, the income range is $198,000 to $208,000 for married couples and $125,000 to $140,000 for singles and heads of household. If you make too much to contribute directly, the Backdoor Roth IRA could still be an option for you!
Solo 401(k)s & SEP IRAs. Limits for Solo 401(k)s and SEP IRAs increase to $58,000, a $1,000 increase from last year.
SIMPLE IRAs. Limits for SIMPLE IRAs stay at $13,500 or $16,500 if you are 50 or older in 2021.
Health Savings Accounts. HSA limits get a small bump up to $3,600 for individuals and $7,200 for families covered under qualifying family plans. The catch up contribution – which applies to those 55 or older for HSAs – stays at $1,000.
Questions? Don’t hesitate to reach out…we’re here to help!
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