The IRS announced this week that contribution limits to key types of retirement plans will increase in 2026. The rule changes impact employer-sponsored 401(k) and 403(b) accounts, as well as 457(b) and Thrift Savings Plans offered to government employees.
The agency said Thursday that the annual contribution limit for these types of accounts will rise from $23,500 in 2025 to $24,500 in 2026. Additionally, annual contributions to individual retirement accounts (IRAs) will increase from $7,000 this year to $7,500 next year.
The IRS also announced further guidance around “catch-up” contribution limits for people 50 and older. This limit was amended under the SECURE 2.0 Act of 2022, and the the annual cost-of-living adjustment will rise to $1,100 in 2026, up $100 from this year’s figure.
The catch-up contribution limit that applies to most of the 50-and-older worker population will also go up by $500 next year to a cap of $8,000. A higher catch-up limit of $11,250 applies to workers ages 60-63. The IRS clarified that any plan participants who are at least 50 will generally be able to contribute as much as $32,500 per year starting in 2026.
Taxpayers can deduct contributions to a traditional IRA if they meet certain conditions, the IRS noted. Deductions based on contributions by the taxpayer or their spouse can be phased out until they’re eliminated, depending on the person’s filing status and income.
These are the phase-out ranges for 2026:
- $81,000 to $91,000 for single filers covered by a workplace retirement plan
- $129,000 to $149,000 for married couples filing jointly, if the spouse making an IRA contribution is covered by a workplace plan
- $242,000 to $252,000 for IRA contributors who are not covered by a workplace plan and is married to someone who is
- Up to $10,000 for married individuals who file separately and are covered by a workplace plan. This phase-out range isn’t subject to an annual cost-of-living adjustment.
The IRS’s announcement also listed new guidance for 2026 regarding Roth IRA, Saver’s Credit and SIMPLE retirement accounts.
In September, the agency announced new rules that apply to the 50-and-older population. These go into effect Nov. 17 and generally apply to contributions for tax years starting in 2027.
The key change among these provisions is that higher-income employees (those who earn more than $145,000 annually) are now require to put their catch-up contributions into a Roth 401(k). This forces them to pay taxes upfront rather than at the time of taking distributions in retirement.
The IRS noted that the $145,000 income threshold is based on prior-year wages and applies separately at each employer. New hires and self-employed workers without W-2 wages are exempt.