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2022 Annual Limits Relating to Your Accounts

Updated: Jan 11, 2022

by Michael Mooney, CFP, MBA

As we are now into the New Year, we wanted to make you aware of the updated Contribution/Income Limits (and related) as set forth by the IRS for 2022.

Each year, the IRS distributes this information after recalculating the amounts. Typically, each of these limits are indexed for inflation, and will rise accordingly. As inflation was greater in 2021 than in years past, many of the limits below increased by significant amounts.

Even though each item below is indexed for inflation, it is not an exact increase. The IRS typically uses round amounts (to the nearest $500 or $1,000), so some of these will only change every few years. For instance, the Annual Gift Tax Exclusion was increased to $16,000 in 2022, after being $15,000 for the previous four years.

If you normally contribute a fixed dollar amount into your workplace retirement account (such as making the maximum contribution into your 401K each year), you may want to contact your HR department to get that updated.

Please reach out to your Financial Advisor today with any questions.

-Qualified Plan Elective Deferrals (401(k), 403(b), 457) – Under 50 Years Old: $20,500

-Qualified Plan Elective Deferrals (401(k), 403(b), 457) – 50 Years or Older: $27,000

-Total Defined Contribution Plan (Employer + Employee): $61,000

-SEP IRA: $61,000

-SIMPLE IRA – Under 50 Years Old: $14,000

-SIMPLE IRA – 50 Years or Older: $3,000

-Traditional IRA – Under 50 Years Old: $6,000

-Traditional IRA – 50 Years or Older: $7,000

-IRA Contribution Deduction Phase Out for Active Participants:

-Single: $68,000-$78,000

-Married Filing Jointly: $109,000-$129,000

-Married Filing Separately: $0-$10,000

-Roth IRA – Under 50 Years Old: $6,000

-Roth IRA – 50 Years or Older: $7,000

-Roth IRA Phase Out:

-Single: $129,000-$144,000

-Married Filing Jointly: $204,000-$214,000

-Health Savings Account (HSA):

-Single – Under 50 Years Old $3,650

-Single – 50 Years or Older: $4,650

-Family – Under 50 Years Old: $7,300

-Family – 50 Years or Older: $8,300

Federal Estate Tax Lifetime Gift Exemption: $12,060,000

Annual Gift Tax Exclusion: $16,000

Wells Fargo Advisors Financial Network is not a legal or tax advisor. Be sure to consult your own tax advisor and investment professional before taking any action that may involve tax consequences.

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