In working with your qualified plan, the plan, plan sponsor, and participants will be subject to various pension limits as prescribed by the Internal Revenue Code.
Section 415 of the Internal Revenue Code provides for dollar limits on the benefits and the contributions for qualified retirement plans.
The 2023 pension limits as set by the Internal Revenue Service can be found below.
2023 Pension Limits
Bold numbers indicate a change from 2022.
|
2023 |
2022 |
2021 |
|
| Maximum Annual Pension Benefit |
$265,000 |
$245,000 |
$230,000 |
| Maximum Annual Addition |
$66,000 |
$61,000 |
$58,000 |
| Maximum Elective Deferral |
$22,500 |
$20,500 |
$19,500 |
| Catch-up Contribution-401(k), 403(b) |
$7,500 |
$6,500 |
$6,500 |
| Qualified Plan Compensation Limit |
$330,000 |
$305,000 |
$290,000 |
| Highly Compensated Employee | $150,000 |
$135,000 |
$130,000 |
| Key Employee Compensation | $215,000 |
$200,000 |
$185,000 |
| SIMPLE Maximum Contribution (+ Catch-up) | $15,500 (+$3,500) |
$14,000 (+$3,000) |
$13,500 (+$3,000) |
Note that the maximum annual addition limit applies to defined contribution plans, such as 401(k)/profit sharing plans. 401(k) elective deferrals are in fact applied to this annual addition limit.