2022 Cost-Of-Living Adjustments for Qualified Retirement Plans

The Social Security Administration (SSA) and Internal Revenue Service (IRS) have announced the government’s annual cost-of-living adjustments (COLA) for 2022:

  • There was a notable 5.9% increase in Social Security and Supplemental Security Income benefits, which represents the largest benefits increase since 1982 (2008 comes in a close second with a 5.8% increase).
  • The IRS adjustments consist of generally across-the-board increases, including the IRS annual compensation amounts and limits for elective deferrals. These and other increases reflect the current inflationary environment, in sharp contrast to 2021’s relatively flat adjustments. However, catch-up contribution limits for 2022 remain unchanged.

 

Code Section 2022 2021 2020 2019 2018
401(a)(17)/404(l) Annual Compensation $305,000 $290,000 $285,000 $280,000 $275,000
402(g)(1) Elective Deferrals 20,500 19,500 19,500 19,000 18,500
408(k)(2)(C) SEP Minimum Compensation 650 650 600 600 600
408(k)(3)(C) SEP Maximum Compensation 305,000 290,000 285,000 280,000 275,000
408(p)(2)(E) SIMPLE Maximum Contributions 14,000 13,500 13,500 13,000 12,500
409(o)(1)(C)(ii) ESOP Limits 1,230,000

245,000

1,165,000

230,000

1,150,000

230,000

1,130,000

225,000

1,105,000

220,000

414(q)(1)(B) HCE Threshold 135,000 130,000 130,000 125,000 120,000
414(v)(2)(B)(i) Catch-up Contributions 6,500 6,500 6,500 6,000 6,000
414(v)(2)(B)(ii) Catch-up Contributions 3,000 3,000 3,000 3,000 3,000
415(b)(1)(A) DB Limits 245,000 230,000 230,000 225,000 220,000
415(c)(1)(A) DC Limits 61,000 58,000 57,000 56,000 55,000
416(i)(1)(A)(i) Key Employee 200,000 185,000 185,000 180,000 175,000
457(e)(15) Deferral Limits 20,500 19,500 19,500 19,000 18,500
1.61-21(f)(5)(i) Control Employee 120,000 115,000 115,000 110,000 110,000
1.61-21(f)(5)(iii) Control Employee 245,000 235,000 230,000 225,000 220,000
219(b)(5)(A) IRA Contribution Limit 6,000 6,000 6,000 6,000 5,500
219(b)(5)(B) IRA Catch-Up Contributions 1,000 1,000 1,000 1,000 1,000
Taxable Wage Base for Social Security 147,000 142,800 137,700 132,900 128,700