{"id":139807,"date":"2025-11-17T17:24:16","date_gmt":"2025-11-17T17:24:16","guid":{"rendered":"https:\/\/www.newsbeep.com\/nz\/139807\/"},"modified":"2025-11-17T17:24:16","modified_gmt":"2025-11-17T17:24:16","slug":"irs-increases-amount-you-can-pay-into-your-401k-in-2026","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/nz\/139807\/","title":{"rendered":"IRS Increases Amount You Can Pay Into Your 401k in 2026"},"content":{"rendered":"

The Internal Revenue Service<\/a> (IRS) has released its updated retirement savings limits for 2026, announcing higher contribution caps for a range of tax-advantaged accounts. <\/p>\n

Why It Matters<\/p>\n

In a news release issued Thursday, the agency said individuals would be able to set aside more money<\/a> in their workplace retirement plans next year, marking the largest increase in two years.<\/p>\n

What To Know<\/p>\n

According to the IRS, the maximum amount workers can contribute to their 401(k) plans will rise to\u00a0$24,500\u00a0in 2026, up from\u00a0$23,500\u00a0in 2025. The same limit applies to 403(b) accounts, most 457 plans and the federal Thrift Savings Plan. The agency said that the increase was double the $500 annual adjustments seen in both 2024 and 2025.<\/p>\n

The IRS also outlined new catch-up contribution rules for older savers. People aged 50 and over will be able to contribute an additional\u00a0$8,000\u00a0to their 401(k) plans next year, compared with $7,500 in 2025. The enhanced catch-up provision provided under the 2024 Secure 2.0 Act for individuals aged 60 to 63 remains unchanged at\u00a0$11,250, which is added on top of the standard 2026 deferral limit.<\/p>\n

\"\"<\/p>\n

For individual retirement accounts, the catch-up contribution for those 50 and older increases to\u00a0$1,100, up from $1,000 for 2025. The IRS is also boosting the standard IRA contribution limit, which will climb to\u00a0$7,500, compared with $7,000 this year.<\/p>\n

The agency is raising income thresholds for Roth IRA eligibility as well. For 2026, individuals filing as single or as heads of household will see the phase-out range shift to\u00a0$153,000 to $168,000, up from $150,000 to $165,000. Married couples filing jointly will have a phase-out range of\u00a0$242,000 to $252,000, compared with $236,000 to $246,000 for 2025. The range for married individuals filing separately – $0 to $10,000 – does not adjust annually and remains the same.<\/p>\n

The IRS also increased income limits for the Saver\u2019s Credit, a tax benefit intended to help low- and moderate-income workers save for their retirement. For 2026, the credit applies to those earning up to\u00a0$80,500\u00a0for married couples filing jointly,\u00a0$60,375\u00a0for heads of household and\u00a0$40,250\u00a0for single filers and married couples filing separately.<\/p>\n

What People Are Saying<\/p>\n

Financial experts say the expanded limits may offer valuable opportunities for workers looking to strengthen their long-term savings. <\/p>\n

Lisa Featherngill, national director of strategic wealth and business advisory at Comerica Wealth Management, told Newsweek: \u201cThe new 2026 retirement plan limits give people more room to save<\/a>, which is especially helpful as retirement gets longer and more expensive. Higher limits for 401(k), 457, and similar plans – along with bigger catch-up contributions – make it easier for workers to put away more money each year.\u201d<\/p>\n

She added that the rising income threshold for after-tax contributions may prompt higher earners to revisit their savings strategy: \u201cSince the income threshold for after-tax contributions is increasing to $150,000 and Roth catch-up rules are expected to apply, higher earners should take a moment to review how they\u2019re contributing. A quick check-in with an advisor can help make sure they\u2019re taking full advantage of the new limits and staying on track for their long-term goals.\u201d<\/p>\n

What Happens Next<\/p>\n

The full list of changes for 2026 is available on the IRS website.<\/p>\n","protected":false},"excerpt":{"rendered":"The Internal Revenue Service (IRS) has released its updated retirement savings limits for 2026, announcing higher contribution caps…\n","protected":false},"author":2,"featured_media":139808,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[2169,138,246,26472,111,139,69,12613,244,245,294],"class_list":{"0":"post-139807","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-401k","9":"tag-business","10":"tag-finance","11":"tag-irs","12":"tag-new-zealand","13":"tag-newzealand","14":"tag-nz","15":"tag-pensions","16":"tag-personal-finance","17":"tag-personalfinance","18":"tag-retirement"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/139807","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=139807"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/139807\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/139808"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=139807"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=139807"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=139807"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}