For 2024, there have been several adjustments to contribution limits across various financial instruments, including retirement accounts, investment accounts, and more.
Understanding these changes will be vital in assisting clients in making informed decisions about their financial goals and investment strategies.
Below is a breakdown of the most notable updates as they pertain directly to Defined Contribution and Defined Benefit Plans.
(Increased limits from 2023 are shown below in bold)
1The $23,000 elective deferral limit is also known as the 402(g) limit, after the relevant tax code section
2The $7,500 catch-up contribution limit for participants aged 50 or older applies from the start of the year in which the employee is turning 50
3Total contributions from all sources may not exceed 100% of a participant’s total compensation
4For the 2024 plan year, an employee who earns more than $150,000 in 2023 is an HCE. For the 2025 plan year, an employee who earns more than $155,000 in 2024 is an HCE.
Source: IRS Notice 2023-75