IRS Increases Contribution Limits for 7 Retirement Accounts — Including the First IRA Catch-Up Hike In Years. Here’s How Much More You Can Save In 2026

Savers hoping to boost their retirement contributions in 2026 are getting good news: the IRS has announced inflation-based increases for seven types of retirement accounts.

Income limits for IRAs and the cap for qualified charitable distributions (QCDs) are also rising. These changes will apply to tax returns filed by April 2026.

Higher Base Contribution Limits for Workplace Plans

For 2026, the standard contribution limit will rise from $23,500 to $24,500 for:

• 401(k) plans
• 403(b) plans
• Governmental 457 plans
• The federal Thrift Savings Plan (TSP)

SIMPLE retirement accounts will also see their base limit increase from $16,500 to $17,000.

Catch-Up Contribution Increases for Workplace Plans

Workers age 50 or older can make additional “catch-up” contributions. For 2026, the catch-up limit for the following workplace plans will rise from $7,500 to $8,000:

• 401(k)
• 403(b)
• Governmental 457
• TSP

A separate enhanced catch-up applies to workers turning 60–63 during the year, created under the Secure 2.0 Act. That limit remains at $11,250 for 2026.

As a result, older savers can contribute:

• $32,500 if they are 50–59 or 64+: $24,500 + $8,000
• $35,750 if they are 60–63: $24,500 + $11,250

For SIMPLE plans, the catch-up limit will increase from $3,500 to $4,000 for workers 50+, while the enhanced age-60–63 limit remains $5,250.

IRA Contribution Limit Increases

Base IRA Contributions

The limit for both traditional and Roth IRAs will rise from $7,000 to $7,500 in 2026.

IRA Catch-Up Contributions

After years without movement, the IRA catch-up limit—now indexed to inflation under Secure 2.0—will finally increase, rising from $1,000 to $1,100. This means anyone age 50+ can contribute up to $8,600 in 2026, assuming they meet IRA eligibility rules.

Updated Roth IRA Income Eligibility Ranges

Your ability to contribute to a Roth IRA depends on your modified adjusted gross income (AGI). For 2026, the phase-out ranges will be:

• Single: $153,000–$168,000 (up from $150,000–$165,000)
• Head of household: $153,000–$168,000
• Married filing jointly: $242,000–$252,000 (up from $236,000–$246,000)
• Married filing separately: $0–$10,000 (unchanged)

Example: A single filer with AGI below $153,000 may contribute the full limit ($7,500 if under 50, $8,600 if 50+). Those with AGI between $153,000 and $168,000 may contribute a reduced amount, and those above $168,000 cannot contribute to a Roth IRA.

Traditional IRA Income Limits

Whether contributions to a traditional IRA are tax-deductible depends on your income, filing status, and whether you or your spouse is covered by a workplace retirement plan. The IRS provides detailed thresholds in its 2026 announcement.

Higher Limit for Qualified Charitable Distributions (QCDs)

QCDs—charitable donations made directly from an IRA—were long capped at $100,000. Now indexed to inflation, the limit will increase from $108,000 to $111,000 in 2026.

 

Source: Money Talks News