The IRS announced the 2026 changes to contribution limits and income thresholds for retirement savings vehicles. These cost-of-living increases are intended to keep pace with inflation.
Keep reading to learn what’s changed and how it could impact your retirement savings and tax planning.
401(k)s
The IRS raised the annual contribution limit for 401(k) participants to $24,500 for 2026, a $1,000 increase from the 2025 limit. The same increase will apply to 403(b)s, governmental 457 plans, and the federal government’s Thrift Savings Plan.
People 50 or older can also make an additional “catch-up contribution” of $8,000 (up from $7,500 in 2025). Those aged 60-63 can save even more, up to an additional $11,250 (no change from 2025), for a total 401(k) contribution of up to $35,750.
However, starting in 2026, employees who earned more than $150,000 in wages in 2025 will be required to make their 401(k) and similar plan catch-up contributions on a Roth (after-tax) basis. This rule — created under SECURE 2.0 — applies to catch-up contributions for ages 50 and older, including the enhanced catch-up available to participants age 60–63. Employees with wages of $150,000 or less in 2025 may continue making catch-up contributions on a pre-tax or Roth basis.
Individual Retirement Accounts (IRAs)
The annual contribution limit for IRAs is also going up in 2026, from $7,000 to $7,500. And the catch-up contribution limit for those 50 and up will be $1,100 vs. $1,000 in 2025.
Along with those increases also comes changes in the income thresholds used to determine IRA deduction eligibility.
- Single taxpayers covered by a workplace retirement plan: The phaseout range for 2026 is $81,000 to $91,000, up from $79,000 to $89,000.
- Married couples filing jointly: If the spouse making the IRA contribution is covered by a workplace retirement plan, the phaseout range is $129,000 to $149,000, up from $126,000 to $146,000 for 2025.
2026 Contribution Limits and Income Thresholds vs. 2025
IRAs | 2026 | 2025 |
IRA contribution limit | $7,500 | $7,000 |
IRA catch-up contributions (age 50+) | $1,100 | $1,000 |
Roth IRA income phaseout range | 2026 | 2025 |
Married filing jointly | $242,000 - $252,000 | $236,000 - $246,000 |
Single or head of household | $153,000 - $168,000 | $150,000 - $165,000 |
SEP IRAs | 2026 | 2025 |
SEP minimum compensation | $800 | $750 |
SEP maximum contribution | $72,000 | $70,000 |
SEP maximum compensation | $360,000 | $350,000 |
SIMPLE IRAs | 2026 | 2025 |
SIMPLE maximum contributions | $17,000 | $16,500 |
Catch-up contributions (age 50-59, 64+) | $4,000 | $3,500 |
Catch-up contributions (age 60-63) | $5,250 | $5,250 |
401(k), 403(b), profit-sharing plans, etc. | 2026 | 2025 |
Annual compensation limit | $360,000 | $350,000 |
Employee contribution limit | $24,500 | $23,500 |
Catch-up contributions (age 50-59, 64+) | $8,000 | $7,500 |
Catch-up contributions (age 60-63) | $11,250 | $11,250 |
Employee + employer contribution limit | $72,000 | $70,000 |
Defined contribution plan annual additions limit | $72,000 | $70,000 |
ESOP five-year limit | $1,455,000 | $1,415,000 |
Health savings accounts (HSAs) | 2026 | 2025 |
Contribution limit – self-only HDHP coverage | $4,400 | $4,300 |
Contribution limit – family HDHP coverage | $8,750 | $8,550 |
Catch-up contribution (age 55+) | $1,000 | $1,000 |
Other | 2026 | 2025 |
Social Security taxable wage limit | $184,500 | $176,100 |
Defined benefit plan maximum annual benefit | $290,000 | $280,000 |
Tax planning implications
According to Vanguard’s 2025 How America Saves report, only 14% of participants maxed out their 401(k) contributions in 2024. Not only does this put most Americans behind on their retirement savings, but they are likely also missing out on important tax savings. Contributing more to a 401(k) or IRA can lead to larger tax deductions, lowering taxable income.
As you plan for 2026, reach out to your Mowery & Schoenfeld Wealth Management advisor to ensure your retirement planning and tax strategies are in sync. Contact us
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