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What Are the 2022 Benefit Plan Limits and Thresholds?

The IRS recently announced that the amount people can contribute to their 401(k) plans in 2022 has increased to $20,500, up from $19,500 for last year. The IRS also issued technical guidance regarding all of the cost‑of‑living adjustments affecting dollar limitations for pension plans and other retirement-related items for the 2022 tax year in Notice 2021-61 PDF, posted on IRS.gov. Below are some comprehensive charts to help you better understand these changes.

401(k) Plan Limits

Defined Contribution Plans 2022 2021 Change

Maximum employee elective deferral (age 49 or younger)

$20,500

$19,500

+$1,000

Employee catch-up contribution (age 50 or older by year-end)

$6,500

$6,500

no change

Maximum employee elective deferral plus catch-up contribution (age 50 or older)

$27,000

$26,000

+$1,000

Defined contribution maximum limit, employee + employer (age 49 or younger)

$61,000

$58,000

+$3,000

Defined contribution maximum limit (age 50 or older), all sources + catch-up

$67,500

$64,500

+$3,000

Employee compensation limit for calculating contributions

$305,000

$290,000

+$15,000

Key employees’ compensation threshold for top-heavy plan testing

$200,000

$185,000

+$15,000

Highly compensated employees’ threshold for nondiscrimination testing

$135,000

$130,000

+$5,000

Source: IRS Notice 2021-61.

 

HSA and HDHP Limits

Health Savings Accounts (HSAs) and High-Deductible Health Plans (HDHPs)  2022 2021 Change

HSA contribution limit
(employer + employee)

Self-only: $3,650

Family: $7,300

Self-only: $3,600

Family: $7,200

Self-only: +$50

Family: +$100

HSA catch-up contributions
(age 55 or older)

$1,000

$1,000

no change

HDHP minimum deductibles

Self-only: $1,400

Family: $2,800

Self-only: 1,400

Family: $2,800

no change

no change

HDHP maximum out-of-pocket amounts (deductibles, co-payments and other amounts, but not premiums)

Self-only: $7,050

Family: $14,100

Self-only: $7,000

Family: $14,000

Self-only: +50

Family: +$100

Source: IRS Revenue Procedure 2021-25.

 

Health FSA Limits

Health Care Flexible Spending Accounts (Health FSAs) and Limited-Scope (Vision/Dental) FSAs

2022

2021

Change

Maximum salary deferral

$2,850

$2,750

+$100

Maximum rollover amount

$570

$550 (as indexed, but carryover of full unused balance allowed)1

+$20
(indexed amount)

Source: IRS Revenue Procedure 2021-45.

 

Dependent Care FSA Limits

Dependent Care FSAs (DC-FSAs) also called Dependent Care Assistance Plans (DCAPs)

2022

2021

Change

Maximum salary deferral
(single taxpayers and married couples filing jointly)

$5,000

$5,000 (as indexed, but raised to $10,500)1

no change (indexed amount)

Maximum salary deferral
(married couples filing separately)

$2,500

$2,500 (as indexed, but raised to $5,250)1

no change (indexed amount)

Source: IRS Revenue Procedure 2021-45.

 

QSEHRA Limits

Qualified Small Employer Health Reimbursement Arrangements (QSEHRAs)  2021 2021 Change

Maximum payments and reimbursements through the QSEHRA

Self-only: $5,450

Family: $11,050

Self-only: $5,300

Family: $10,700

Self-only: +$150

Family: +$350

Source: IRS Revenue Procedure 2021-45.

 

Commuter Transit and Parking Limits

Qualified Transportation Benefit
(monthly limits)

2022

2020

Change

Transit passes and van pool services (employer + employee)

$280

$270

+$10

Qualified parking

$280

$270

+$10

Source: IRS Revenue Procedure 2021-45.

 

Adoption Assistance

Adoption Benefits
(Annual limits)
2022 2021 Change

Excludable Amount

$14,890

$14,440

+$450

Phase-out income thresholds:

Phase-out begins

$223,410

$216,660

+$6,750

Phase-out complete

$263,410

$256,660

+$6,750

Source: IRS Revenue Procedure 2021-45.

 

Earnings Subject to Social Security Payroll Tax

Social Security (FICA) Payroll Tax

2022

2020

Change

Maximum earnings subject to Social Security 12.4% FICA payroll tax (6.2% paid by employer and 6.2% paid by employee)

$147,000

$142,800

+$4,200

Source: Social Security Administration.

 

If you or your business need further information on the 2022 Benefit Plan Limits and Thresholds, don’t hesitate to contact us! We’re here to help.