IRS Increases 401(k) Contribution Limit for 2026, Makes Other Cost-of-Living Adjustments
The IRS recently announced an increase to the amount individuals can contribute to their 401(k) plans in 2026, bringing to the maximum contribution to $24,500 for 2026 (up from $23,500 for 2025). They also issued technical guidance regarding all cost of living adjustments affecting dollar limitations for pension plans and other retirement-related items for tax year. Although the changes are more modest than in recent years, they may provide extra room to boost your retirement savings depending on your plan.
Retirement Plan Contribution Limits for 2026
| Type of limitation | 2025 limit | 2026 limit |
|---|---|---|
| Elective deferrals to 401(k), 403(b) and 457 plans | $23,500 | $24,500 |
| Annual benefit limit for defined benefit plans | $280,000 | $290,000 |
| Contributions to defined contribution plans | $70,000 | $72,000 |
| Contributions to SIMPLEs | $16,500 | $17,000 |
| Contributions to traditional and Roth IRAs | $7,000 | $7,500 |
| Catch-up contributions to 401(k), 403(b) and 457 plans for those age 50 or older* | $7,500 | $8,000 |
| Catch-up contributions to 401(k), 403(b) and 457 plans for those age 60, 61, 62 or 63* | $11,250 | $11,250 |
| Catch-up contributions to SIMPLE plans for those age 50 or older | $3,500 | $4,000 |
| Catch-up contributions to SIMPLE plans for those age 60, 61, 62 or 63 | $5,250 | $5,250 |
| Catch-up contributions to IRAs for those age 50 or older | $1,000 | $1,100 |
| Compensation for benefit purposes for qualified plans and SEPs | $350,000 | $360,000 |
| Minimum compensation for SEP coverage | $750 | $800 |
| Highly compensated employee threshold | $160,000 | $160,000 |
*Starting in 2026, the SECURE 2.0 Act requires the catch-up contributions of higher-income taxpayers to be treated as post-tax Roth contributions. Generally for 2026, the requirement will apply to taxpayers who earned more than $150,000 during the prior year. However, new final regulations state that the deadline for plan amendments to implement this change is Dec. 31, 2026. So, there might not be any adverse consequences for plans that continue to allow non-Roth account catch-up contributions for higher-income taxpayers in 2026.
Your modified adjusted gross income (MAGI) may reduce or even eliminate your ability to take advantage of IRAs. Fortunately, IRA-related MAGI phaseout range limits will all increase for 2026:
Traditional IRAs. MAGI phaseout ranges apply to the deductibility of contributions if a taxpayer (or his or her spouse) participates in an employer-sponsored retirement plan:
- For married taxpayers filing jointly, the phaseout range is specific to each spouse based on whether he or she is a participant in an employer-sponsored plan:
- For a spouse who participates, the 2026 phaseout range limits will increase by $3,000, to $129,000–$149,000.
- For a spouse who doesn’t participate, the 2026 phaseout range limits will increase by $6,000, to $242,000–$252,000.
- For single and head-of-household taxpayers participating in an employer-sponsored plan, the 2026 phaseout range limits will increase by $2,000, to $81,000–$91,000.
Taxpayers with MAGIs in the applicable range can deduct a partial contribution; those with MAGIs exceeding the applicable range can’t deduct any IRA contribution.
But a taxpayer whose deduction is reduced or eliminated can make nondeductible traditional IRA contributions. The $7,500 contribution limit for 2026 (plus $1,100 catch-up, if applicable, and reduced by any Roth IRA contributions) still applies.
Nondeductible traditional IRA contributions may also be beneficial if your MAGI is too high for you to contribute (or fully contribute) to a Roth IRA.
Roth IRAs. Whether you participate in an employer-sponsored plan doesn’t affect your ability to contribute to a Roth IRA, but MAGI limits may reduce or eliminate your ability to contribute:
- For married taxpayers filing jointly, the 2026 phaseout range limits will increase by $6,000, to $242,000–$252,000.
- For single and head-of-household taxpayers, the 2026 phaseout range limits will increase by $3,000, to $153,000–$168,000.
You can make a partial contribution if your MAGI falls within the applicable range, but no contribution if it exceeds the top of the range.
(Note: Married taxpayers filing separately are subject to much lower phaseout ranges for traditional and Roth IRAs.)
Here to Help
When reviewing your retirement plan, be sure to take these 2026 contribution limits into account. We can help you review your retirement plan and make any necessary revisions.
