What You Need To Know
The IRS has officially released the 2026 cost-of-living adjustments (COLAs) for retirement plans—and the news is good for anyone trying to save more for the future. With inflation and higher living costs in mind, the IRS has increased contribution limits for 401(k)s, IRAs, SIMPLE plans, and more. These increases give taxpayers more room to save, reduce taxable income, and take advantage of tax-favored retirement options.
Here’s a breakdown of the key changes you should know as you plan for 2026.
Higher Contribution Limits for 401(k), 403(b), 457 & TSP Plans
For 2026, employees can contribute up to $24,500 to:
- 401(k) plans
- 403(b) plans
- Governmental 457 plans
- The federal Thrift Savings Plan (TSP)
This is an increase from $23,500 in 2025, giving workers an additional boost in tax-advantaged savings.
Catch-Up Contributions for Age 50+ Also Increased
Workers age 50 and older can make catch-up contributions on top of the standard limit. For 2026, the catch-up limit increases to:
- $8,000 (up from $7,500 for 2025)
This means individuals 50 and older can contribute up to $32,500 total each year starting in 2026.
Special Higher Catch-Up for Ages 60–63
Thanks to the SECURE 2.0 Act, taxpayers age 60–63 get an enhanced catch-up limit. For 2026, this amount remains:
- $11,250
This is a substantial advantage for individuals looking to boost retirement contributions during their final working years.
IRA Limits Are Increasing Too
If you contribute to a Traditional or Roth IRA, you’ll also see higher limits next year.
Standard IRA Contribution Limit
The 2026 limit increases to:
- $7,500 (up from $7,000 for 2025)
IRA Catch-Up Contribution (Age 50+)
SECURE 2.0 changed the rules so the IRA catch-up now receives COLA increases. For 2026:
- Catch-up increases to $1,100 (up from $1,000)
Expanded Income Phase-Out Ranges for IRAs and Roth IRAs
If you’ve ever been limited by income rules when contributing to a Traditional or Roth IRA, the expanded phase-out ranges may benefit you.
Traditional IRA Deduction Phase-Out Ranges for 2026
- Single taxpayers covered by a workplace plan:
$81,000–$91,000 (up from $79,000–$89,000) - Married filing jointly (contributing spouse covered at work):
$129,000–$149,000 (up from $126,000–$146,000) - Married filing jointly (contributing spouse NOT covered, but spouse is covered):
$242,000–$252,000 (up from $236,000–$246,000) - Married filing separately:
Unchanged at $0–$10,000
Roth IRA Income Phase-Out Ranges for 2026
- Single/Head of Household:
$153,000–$168,000 (up from $150,000–$165,000) - Married Filing Jointly:
$242,000–$252,000 (up from $236,000–$246,000) - Married Filing Separately:
No change—still $0–$10,000
These increases mean more taxpayers may qualify for Roth IRA contributions or partial IRA deductions.
Saver’s Credit Income Limit Increases
Low- and moderate-income taxpayers may benefit from the expanded Saver’s Credit income limits. For 2026, the new thresholds are:
- Married filing jointly: up to $80,500
- Head of household: up to $60,375
- Single/married filing separately: up to $40,250
This credit can reduce your tax bill for contributing to a retirement account, making it even more rewarding to save.
SIMPLE IRA and SIMPLE 401(k) Plans: Higher Limits Ahead
Small business owners and employees who use SIMPLE plans also get an increase.
2026 SIMPLE Contribution Limits
- Standard SIMPLE limit: increases to $17,000 (up from $16,500)
Some “enhanced” SIMPLE plans created under SECURE 2.0 get an even higher limit:
- Higher SIMPLE limit: increases to $18,100 (up from $17,600)
SIMPLE Catch-Up Contributions (Age 50+)
- Standard SIMPLE catch-up increases to $4,000 (up from $3,500)
- Certain SIMPLE plans keep a catch-up limit of $3,850
- Special age 60–63 SIMPLE catch-up remains $5,250
Planning Ahead for 2026
These increases give taxpayers more ways to:
✔ Reduce taxable income
✔ Maximize employer matching contributions
✔ Boost long-term retirement savings
✔ Take advantage of enhanced catch-up contributions under SECURE 2.0
Whether you’re an employee, self-employed, or a small business owner offering retirement plans, now is the perfect time to evaluate your 2026 savings strategy.
Now is the time to book that appointment with your personal financial planner to get a better understanding of these changes and how they affect you. If you don’t have a financial planner, feel free to contact me and I will supply you with a list of referrals.
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