Beginning in 2026, the Internal Revenue Service (IRS) will increase the contribution limits for several retirement savings plans. The annual cap for employees contributing to 401(k), 403(b), governmental 457 plans, and the federal Thrift Savings Plan will rise by $1,000 to $24,500. For individual retirement accounts (IRAs), the limit will go up by $500 to $7,500.
The IRS announced these adjustments in Notice 2025-67, which details cost-of-living changes affecting pension and retirement-related items for tax year 2026.
Employees aged 50 and over who participate in most employer-sponsored retirement plans can make catch-up contributions up to $8,000 in 2026, an increase from $7,500. This means that those employees may contribute as much as $32,500 annually starting next year. A higher catch-up limit of $11,250 remains available for participants aged 60 through 63.
For IRAs, individuals aged 50 and above can make catch-up contributions of up to $1,100 in 2026—up from the previous year’s limit of $1,000.
Taxpayers may deduct traditional IRA contributions if they meet certain requirements; however, deductions may be reduced or eliminated based on income level and filing status when either spouse is covered by a workplace retirement plan. The phase-out ranges have also increased: single taxpayers covered by a workplace plan face a phase-out between $81,000 and $91,000; married couples filing jointly see their range move to between $129,000 and $149,000 if the contributor is covered at work; those not covered but married to someone who is now have a phase-out between $242,000 and $252,000. For married individuals filing separately who are covered by a workplace plan, the phase-out range remains unchanged at between $0 and $10,000.
