COLA increases for dollar limitations on benefits and contributions | Internal Revenue Service

COLA increases for dollar limitations on benefits and contributions

 

The tax law places limits on the dollar amount of contributions to retirement plans and IRAs and the amount of benefits under a pension plan. IRC Section 415 requires the limits to be adjusted annually for cost-of-living increases.

IRAs 2025 2024 2023 2022
IRA contribution limit $7,000 $7,000 $6,500 $6,000
IRA catch-up contributions 1,000 1,000 1,000 1,000
Traditional IRA AGI deduction phase-out starting at 2025 2024 2023 2022
Joint return 126,000 123,000 116,000 109,000
Single or head of household 79,000 77,000 73,000 68,000
SEP 2025 2024 2023 2022
SEP minimum compensation 750 750 750 650
SEP maximum contribution 70,000 69,000 66,000 61,000
SEP maximum compensation 350,000 345,000 330,000 305,000
SIMPLE plans 2025 2024 2023 2022
SIMPLE maximum contributions 16,500 16,000 15,500 14,000
Catch-up contributions 3,500* 3,500 3,500 3,000

*Under a change made in SECURE 2.0, a higher catch-up contribution limit applies for employees aged 60, 61, 62 and 63 who participate in SIMPLE plans. For 2025, this higher catch-up contribution limit is $5,250.

401(k), 403(b), profit-sharing plans, etc. 2025 2024 2023 2022
Annual compensation 350,000 345,000 330,000 305,000
Elective deferrals 23,500 23,000 22,500 20,500
Catch-up contributions 7,500** 7,500 7,500 6,500
Defined contribution limits 70,000 69,000 66,000 61,000
ESOP limits

1,415,000

280,000

1,380,000

275,000

1,330,000

265,000

1,230,000

245,000

**Under a change made in SECURE 2.0, a higher catch-up contribution limit applies for employees aged 60, 61, 62 and 63 who participate in these plans. For 2025, this higher catch-up contribution limit is $11,250 instead of $7,500.

Other 2025 2024 2023 2022
HCE threshold 160,000 155,000 150,000 135,000
Defined benefit limits 280,000 275,000 265,000 245,000
Key employee 230,000 220,000 215,000 200,000
457 elective deferrals 23,500 23,000 22,500 20,500
Control employee (board member or officer) 140,000 135,000 130,000 120,000
Control employee (compensation-based) 285,000 275,000 265,000 245,000
Taxable wage base 176,100 168,600 160,200 147,000