The IRS has announced the 2023 annual dollar limitations for retirement plans based on the applicable cost-of-living adjustment guidelines, with increases in many of the limits. The annual limit for elective deferrals to 401(k) plans and 403(b) plans will increase from $20,500 for 2022 to $22,500 for 2023, while the annual limit for catch-up contributions for individuals aged 50 or over will increase from $6,500 for 2022 to $7,500 for 2023. The Social Security Administration also recently announced that the Social Security wage base will increase from $147,000 for 2022 to $160,200 for 2023.
Listed below are key limits applicable for 2023 and 2022.
| Limit |
2023 |
2022 |
| Annual Compensation Limit (also known as 401(a)(17) limit) |
$330,000 |
$305,000 |
| Elective Deferrals (401(k) plans, 403(b) plans, 457(b) plans) |
$22,500 |
$20,500 |
| Catch-up Contributions (plans other than SIMPLE plans) |
$7,500 |
$6,500 |
| Defined Contribution Plan 415 Limit |
$66,000 |
$61,000 |
| Defined Benefit Plan 415 Limit |
$265,000 |
$245,000 |
| Highly Compensated Employee |
$150,000 |
$135,000 |
| SIMPLE Plan Limit |
$15,500 |
$14,000 |
| SIMPLE Catch-up Contributions |
$3,500 |
$3,000 |
| Social Security Wage Base |
$160,200 |
$147,000 |