IRS Increases 2026 401(k) and IRA Contribution Limits
The Internal Revenue Service (IRS) has announced increased contribution limits for retirement plans for the year 2026, reflecting adjustments for inflation. These changes impact various retirement savings options, including 401(k) and IRA accounts.
Increased Contribution Limits for 2026
For 2026, the contribution limit for 401(k) plans, along with 403(b), governmental 457 plans, and the federal government’s Thrift Savings Plan, will rise to $24,500. This marks an increase from the previous limit of $23,500 in 2025.
The maximum contribution limit for Individual Retirement Accounts (IRAs) will also see an increase, going up to $7,500 from $7,000.
Catch-Up Contributions
Individuals aged 50 and older will benefit from enhanced catch-up contribution limits. The new limit is set at $8,000 for most plans, an increase from $7,500 in 2025.
For those aged 60 to 63, a special catch-up contribution limit will remain at $11,250 in 2026. This is part of the adjustments made under the SECURE 2.0 Act of 2022.
Income Phase-Out Ranges
The IRS has also updated the income phase-out ranges for various IRA contributions, which will apply starting in 2026. Here are the new ranges:
- For single taxpayers covered by a workplace retirement plan: $81,000 – $91,000
- For married couples filing jointly (contributor covered by a workplace plan): $129,000 – $149,000
- For married contributors not covered by a workplace plan: $242,000 – $252,000
- For married individuals filing separately and covered by a workplace plan: $0 – $10,000
Additional Phase-Out Updates
- The income phase-out range for Roth IRA contributions for singles and heads of household has increased to $153,000 – $168,000.
- For married couples filing jointly, the range is now $242,000 – $252,000.
The phase-out limit for the Saver’s Credit has also increased, now set at:
- $80,500 for married couples filing jointly
- $60,375 for heads of household
- $40,250 for singles and married individuals filing separately
SIMPLE Retirement Accounts
The contribution limits for SIMPLE retirement accounts will rise to $17,000, an increase from $16,500 in 2025. Notably, the catch-up contribution limit for those aged 50 and older will be increased to $4,000 from $3,500.
Overall, these adjustments signify a significant update for retirement savers, providing enhanced opportunities for individuals to grow their retirement savings. The IRS continues to outline these important updates through technical guidance, ensuring taxpayers are informed about the available options for retirement savings.
