IRS announces 2026 boost in 401(k) and IRA contribution limits: Here’s what changes

The IRS shared new rules on Thursday, November 13, saying that Americans will be able to save more money in their retirement accounts in 2026. The agency raised the contribution limits so people can protect their savings from inflation and also reduce their taxable income. The changes apply to 401(k) plans, IRAs and other common retirement accounts.

Higher Limits for Workplace Plans

The IRS said that workers who use 401(k), 403(b), government 457 plans, or the federal Thrift Savings Plan will be allowed to put in $24,500 in 2026. This is higher than the $23,500 allowed in 2025. The increase comes from COLA changes the IRS makes every year.

Social Security Raises Income Needed to Earn Work Credits Starting in 2026

People who are 50 or older will also get a bigger catch-up limit. They can add $8,000 in 2026, which is $500 more than in 2025. Workers aged 60 to 63 will continue to get a special higher limit of $11,250 because of SECURE 2.0 rules.

IRA contribution limits are also rising. In 2026, people can put $7,500 in an IRA, up from $7,000 in 2025. For those aged 50 and older, the IRA catch-up amount will be $1,100. These increases also follow the SECURE 2.0 guidelines.

The IRS has also raised the income ranges used to decide who gets IRA deductions, who qualifies for a Roth IRA and who can claim the Saver’s Credit. These changes help more people access tax benefits, depending on their filing status.

Lisa Featherngill from Comerica Wealth Management said, “The new 2026 retirement plan limits give people more room to save, which is especially helpful as retirement gets longer and more expensive.”

Income Limits for Deductions and Roth IRAs Rise

he IRS has increased several income limits for 2026 so people can qualify for more tax benefits while saving for retirement. These new limits help taxpayers understand how much they can deduct or contribute based on their income level.

Important changes you should know:

• Married couples filing jointly (one spouse covered by the workplace plan): New IRA deduction phase out range is $129,000 to $149,000 (up from $126,000 to $146,000).
• Single filers with a workplace plan: $81,000 and $91,000.
• Roth IRA for single filers: $153,000 to $168,000 (previously $150,000 to $165,000).
• Roth IRA for married couples filing jointly: They can contribute if their income is $242,000 to $252,000, instead of the old $236,000 to $246,000 range.
• SIMPLE retirement account limit: The savings limit rises to $17,000 in 2026, up from $16,500.

Catch-up contribution for SIMPLE accounts (age 50+) People can add $4,000 more. Some accounts will continue to follow special higher limits under SECURE 2.0.

Social Security Changes 2026: How the New Payroll Tax Cap May Affect Your Paycheck?

What Americans feel?

Even with these increases, many people still feel nervous about their future money needs. Vanguard says that only 40% of Americans believe they are on track to keep their lifestyle after retirement. Goldman Sachs reported that 42% of workers do not have any spare income after paying their basic expenses.

Another concern is that only a small group actually saves the full amount allowed. In 2024, only 14% of workers put the maximum into their 401(k) accounts, and most of them were older workers with higher incomes.