Key facts
- The catch-up limit for participants ages 50 and older rose to $8,500 from $8,000, for a $34,000 total.
- Participants ages 60 through 63 can contribute up to $37,250, including an $11,750 catch-up limit.
- The IRA contribution limit stays at $7,500, and the IRA catch-up limit stays at $1,100.
- The SIMPLE plan limit rose to $17,500 from $17,000; certain eligible SIMPLE plans have a $19,100 limit.
- Roth IRA income phase-out ranges rose to $158,000 to $173,000 for single filers and $250,000 to $260,000 for joint filers.
The IRS raised the annual employee contribution limit for 401(k) plans to $25,500 for 2027, up $1,000 from $24,500 in 2026, the agency said in guidance issued on November 13, 2026. The same limit applies to 403(b) plans, governmental 457 plans and the federal government's Thrift Savings Plan, according to Notice 2026-66, which sets cost-of-living adjustments for retirement plans and related tax provisions.
The catch-up contribution limit for employees ages 50 and older rose to $8,500 from $8,000, bringing the total annual limit for most eligible participants in that group to $34,000. Employees ages 60 through 63 are eligible for a higher catch-up limit under the SECURE 2.0 Act of 2022; for 2027 that limit rose to $11,750, allowing eligible participants to contribute up to $37,250.
The individual retirement account contribution limit stays at $7,500, and the IRA catch-up limit for individuals ages 50 and older stays at $1,100. The IRS also raised the SIMPLE retirement account limit to $17,500 from $17,000; certain eligible SIMPLE plans have a higher limit of $19,100, compared with $18,100 in 2026. Catch-up limits for most SIMPLE plans stay at $4,000 for employees ages 50 and older, with a $3,850 limit for certain applicable SIMPLE plans and $5,250 for employees ages 60 through 63.
Several income thresholds used to determine eligibility for deductions and contributions also rose. For traditional IRAs, the phase-out range for single taxpayers covered by a workplace retirement plan increased to $83,000 to $93,000 from $81,000 to $91,000. For married couples filing jointly where the contributing spouse is covered by a workplace plan, the range rose to $133,000 to $153,000 from $129,000 to $149,000. For contributors not covered by a workplace plan but married to someone who is, the range rose to $250,000 to $260,000 from $242,000 to $252,000.
Roth IRA income phase-out ranges also increased. For single taxpayers and heads of household, the range is $158,000 to $173,000, compared with $153,000 to $168,000 in 2026. For married couples filing jointly, it rose to $250,000 to $260,000 from $242,000 to $252,000.
Income limits for the Saver's Credit rose to $83,000 for married couples filing jointly, $62,250 for heads of household, and $41,500 for single taxpayers and married individuals filing separately. The IRS said the adjustments are intended to account for cost-of-living changes and help taxpayers and employers plan for the coming year.
"Along with the Working Families Tax Cuts, this increase in the pension limitations will help American families keep more of their hard-earned income," IRS CEO Frank J. Bisignano said in a statement.