The Internal Revenue Service announced significant increases to retirement account contribution limits for 2026, providing Americans with greater opportunities to save for their future. The annual 401k contribution limit will rise to $24,500, up from $23,500 in 2025, while IRA contribution limits will increase to $7,500 from $7,000.
These adjustments, detailed in IRS Notice 2025-67, reflect annual cost-of-living increases designed to help retirement savers keep pace with inflation. The changes affect millions of Americans who contribute to employer-sponsored retirement plans and individual retirement accounts.
For business owners and self-employed professionals, these increases present new planning opportunities. Those with access to Solo 401k plans may be able to contribute as both employee and employer, potentially maximizing their tax-deferred savings strategies under the new limits.
The announcement comes as part of the IRS’s regular review of retirement plan limitations, incorporating changes from the SECURE 2.0 Act of 2022. All new limits take effect January 1, 2026, giving savers time to adjust their contribution strategies.
Expanded Catch-Up Contributions for Older Workers
Workers aged 50 and older will see their catch-up contribution limits increase across multiple account types. For 401k, 403b, governmental 457 plans, and the federal Thrift Savings Plan, the catch-up limit rises to $8,000 from $7,500 in 2025.
This means eligible participants can contribute a total of $32,500 annually to these plans in 2026. Employees aged 60 through 63 may qualify for a higher catch-up limit of $11,250, a provision in the Setting Every Community Up for Retirement Enhancement (SECURE) 2.0 Act of 2022.
IRA catch-up contributions for those 50 and older will increase to $1,100 from $1,000, allowing total IRA contributions of up to $8,600 for eligible savers. “These increases reflect our commitment to helping Americans build retirement security,” according to the IRS announcement.
Income Phase-Out Ranges Adjusted Upward
The IRS also raised income thresholds that determine eligibility for various retirement account benefits. For traditional IRA deductibility, single taxpayers covered by a workplace retirement plan will see their phase-out range increase to between $81,000 and $91,000, up from $79,000 to $89,000 in 2025.
Married couples filing jointly face phase-out ranges of $129,000 to $149,000 if the IRA contributor is covered by a workplace plan, and $242,000 to $252,000 if only the spouse is covered by such a plan.
Roth IRA contribution eligibility phases out between $153,000 and $168,000 for single filers, and between $242,000 and $252,000 for married couples filing jointly. These figures apply to 2026 and determine when Roth IRA contributions are reduced or become ineligible based on income.
For traditional IRA deductibility, the applicable range depends on workplace plan coverage and filing status, as noted above.
SIMPLE Plan Limits and Saver’s Credit Updates
Small business retirement plans also received limit increases for 2026.
SIMPLE IRA and SIMPLE 401(k) contribution limits rise to $17,000 from $16,500, with eligible SIMPLE plans allowing contributions up to $18,100.
The Saver’s Credit, which provides a tax credit for low- and moderate-income retirement savers, will be available based on adjusted gross income (AGI) up to $80,500 for married filing jointly, $60,375 for heads of household, and $40,250 for single filers.
These amounts apply for 2026 and are subject to annual cost-of-living adjustments.
Source: 401(k) Limit Increases to $24,500 for 2026; IRA Limit Increases to $7,500 | IRS