The Internal Revenue Service has released the 2026 cost-of-living adjustments for retirement plans and IRAs. Although many of the figures increase only modestly, they collectively represent a meaningful expansion of tax-advantaged saving opportunities. For individuals and families who take a deliberate, long-term approach to financial planning, these updates provide additional room to strengthen a retirement strategy with clarity and intention.
Below is a distilled overview of the most relevant 2026 changes.
Increases to Contribution Limits
Defined Contribution Plans
The elective deferral limit for 401(k), 403(b), most 457 plans, and the Thrift Savings Plan will increase from 23,500 dollars to 24,500 dollars in 2026.
The total annual additions limit for defined contribution plans, which includes both employer and employee contributions, will rise from 70,000 dollars to 72,000 dollars.
Defined Benefit Plans
The maximum annual benefit allowed under a defined benefit pension plan will increase from 280,000 dollars to 290,000 dollars.
Catch-Up Contribution Adjustments
Age 50 and Older
For most employer retirement plans, the age 50 and older catch-up contribution limit will increase from 7,500 dollars to 8,000 dollars.
Age 60 to 63 Special Catch-Up
The special catch-up provision for individuals aged 60, 61, 62, or 63 will remain 11,250 dollars.
SIMPLE Plans
For SIMPLE plans, the standard catch-up contribution limit for age 50 and older increases from 3,500 dollars to 4,000 dollars.
The special catch-up provision for ages 60 through 63 remains 5,250 dollars.
Roth Catch-Up Income Threshold
Under the Secure 2.0 rules, high-income earners may be required to make catch-up contributions as Roth contributions. The 2026 wage threshold used to determine this requirement will increase from 145,000 dollars to 150,000 dollars.
SIMPLE IRA and SIMPLE 401(k) Changes
The SIMPLE employee contribution limit will increase from 16,500 dollars to 17,000 dollars.
For SIMPLE plans that apply the higher alternative limits, the maximum will increase from 17,600 dollars to 18,100 dollars.
The allowable additional nonelective employer contribution will increase from 5,100 dollars to 5,300 dollars.
IRA Contribution and Income Limit Updates
Traditional IRA Contribution Limits
The deductible traditional IRA contribution limit will increase from 7,000 dollars to 7,500 dollars.
The catch-up amount for individuals aged 50 and older will increase from 1,000 dollars to 1,100 dollars.
Traditional IRA Deduction Phase-Outs
The income ranges for deductibility will shift as follows:
- Single or Head of Household (active participant): 81,000 to 91,000 dollars
- Married Filing Jointly (active participant): 129,000 to 149,000 dollars
- Married Filing Jointly (non-participant married to a participant): 242,000 to 252,000 dollars
- Married Filing Separately: remains 0 to 10,000 dollars
Roth IRA Income Phase-Outs
The 2026 income thresholds for Roth IRA eligibility increase to:
- Married Filing Jointly: 242,000 to 252,000 dollars
- Single or Head of Household: 153,000 to 168,000 dollars
- Married Filing Separately: remains 0 to 10,000 dollars
Saver’s Credit Adjustments
Income thresholds for the Retirement Savings Contributions Credit will rise across all filing statuses. For example, the upper limit for married taxpayers filing jointly increases from 79,000 dollars to 80,500 dollars. These incremental changes widen access to this tax credit for eligible households.
Additional Key Adjustments
- The Highly Compensated Employee threshold remains 160,000 dollars.
- The Key Employee threshold for top-heavy plans increases from 230,000 dollars to 235,000 dollars.
- The general annual compensation limit for qualified plans increases from 350,000 dollars to 360,000 dollars.
- The limit for pension-linked emergency savings accounts increases from 2,500 dollars to 2,600 dollars.
- The Qualified Charitable Distribution limit increases from 108,000 dollars to 111,000 dollars, and the special split-interest QCD limit increases from 54,000 dollars to 55,000 dollars.
- The domestic abuse distribution allowance increases from 10,300 dollars to 10,500 dollars.
What These Changes Mean for Thoughtful Investors
Each of these adjustments serves a broader objective: to help savers maintain purchasing power and preserve long-term financial flexibility in shifting economic conditions. For many households, the higher contribution limits and expanded income thresholds create meaningful opportunities to deepen retirement preparedness, optimize tax positioning, and maintain a disciplined approach to long-term planning.
A careful review of these updates, combined with personalized guidance, can help investors determine how to incorporate these changes into an existing strategy with clarity and confidence.
Have questions about the new limits? Our team is here to help. Contact us at Contact – Moran Wealth Management.
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