The Internal Revenue Service (IRS) announced cost of living adjustments (COLAs) affecting dollar limitations for retirement plans and other retirement-related items for Tax Year 2023.

For the 2023 year there will be a significant increase in all of the key retirement plan limits. The deferral limit increased by $2,000 to $22,500 and the overall DC contribution limit increased $5,000 to $66,000. There was also an increase to the Catch-Up limit, Highly Compensated threshold, and the Annual Compensation Limit. These changes will allow participants to save more for a comfortable retirement.

It is important that you ensure your payroll system is updated to reflect these new limits starting January 1, 2023. If you have any questions about these changes, please contact our office.

As published by the Internal Revenue Service.

For full details on the pension plan limitations for 2023 click here.

To download a PDF copy click here.