IRS Announces 2024 Limits for Qualified Retirement Plans

The IRS recently issued Notice 2023-75 announcing the annual cost-of-living adjustments applicable to qualified retirement plans for 2024. The following is a list of the key annual limits that will apply beginning January 1, 2024:

1. The limitation on the annual benefit under a defined benefit plan increased to $275,000.
2. The limitation on annual additions made to a defined contribution plan increased to $69,000.
3. The limitation on elective deferrals made to 401(k) and 403(b) plans increased to $23,000.
4. The annual compensation limitation used to calculate a participant’s benefit accruals increased to $345,000.
5. The dollar limitation for defining a “key employee” in a top-heavy plan increased to $220,000.
6. The dollar limitation for defining a “highly compensated employee” increased to $155,000.
7. The dollar limitation on catch-up contributions for individuals aged 50 or over to 401(k) and 403(b) plans remains unchanged at $7,500.

If you have any questions about the information in this alert, please contact Amy Christen, Jillie Foerster, Tyler Hubert, or your Dykema relationship attorney.