New Bill Would Triple Retirement Plan Contribution Limits for 2020

Rep. Patrick McHenry (R-NC) has introduced the Securing Additional Value for Every Retirement Saver (SAVERS) Act, legislation that would permit increased annual contributions to tax-qualified retirement savings arrangements for 2020.

The legislation would raise the following annual contribution limitations to 300 percent of previously-announced limits for 2020 (not to exceed applicable compensation).

  • Aggregate elective deferrals of an individual who participates in one or more 401(k), 403(b), governmental 457(b), or SIMPLE IRA plan, including catch-up deferrals
  • SIMPLE IRA-specific elective deferral limitations, including catch-up deferrals
  • Retirement plan annual additions (Internal Revenue Code Section 415) made on behalf of an individual under all plans of an employer
  • IRA contributions (does not appear to apply to catch-up contributions of those age 50 or older)

At a taxpayer’s option, 2019 compensation—or compensation for a tax year beginning in 2019—could be substituted for 2020 compensation.

The legislation has been referred to the House Committee on Ways and Means.