IRS Releases 2021 Cost of Living Adjustments for Certain Tax Provisions

Yesterday, the IRS released IRS Revenue Procedure 2020-45 which provides the 2021 cost-of-living increases for inflation for certain items. In addition, the IRS also released today Notice 2020-79 which provided the 2021 COLA increases for retirement plans, including 401(k) plans. Taxable Years Beginning in 2021 Taxable Years Beginning in 2020 Limit on voluntary employee salary reduction contributions to a health flexible spending arrangement (Section 3.17 of Rev. Proc. 2020-45) $2,750 $2,750 Monthly limit on fringe benefit exclusion for transit and parking (Section 3.18 of Rev. Proc. 2020-45) $270 $270 Maximum exclusion for qualified adoption expenses furnished pursuant to an adoption assistance… Read More