On November 1, 2024, the Internal Revenue Service (IRS) announced in IRS Notice 2024-80 cost-of-living adjustments to the applicable dollar limits for retirement plans for 2025.
The table below compares the applicable dollar limits for retirement plans for 2025 and 2024.
Employers are encouraged to work with their retirement plan recordkeepers and payroll providers to update these limits in applicable systems for January 1, 2025.
|
Retirement Plan Limits |
2025 |
2024 |
Change from 2024 |
|
Section 401(k) / 403(b) / 457(b)(2) Plans maximum elective deferrals |
$23,500 |
$23,000 |
+$500 |
|
Section 401(k) / 403(b) / 457(b)(2) Plans catch-up contribution limit* * For 2025, retirement plan participants age 50 and older may contribute up to $31,000. |
$7,500 |
$7,500 |
No change |
|
Section 401(k) / 403(b) / 457(b)(2) Plans: A higher catch-up contribution limit* applies for employees aged 60, 61, 62, and 63 who participate in these plans. * For 2025, retirement plan participants age 60,61,62, and 63 may contribute up to $34,750. |
$11,250 |
N/A |
N/A |
|
Section 415(c)(1)(A) Defined contribution annual additions limit |
$70,000 |
$69,000 |
+1,000 |
|
Section 414(q)(1)(B) |
$160,000 |
$155,000 |
+$5,000 |
|
Section 416(i)(A)(i) |
$230,000 |
$220,000 |
+$10,000 |
|
Section 401(a)(17) |
$350,000 |
$345,000 |
+$5,000 |
|
Section 408(p)(2)(E) |
$16,500 |
$16,000 |
+$500 |
For more information on the landmark retirement plan legislation known as “Secure 2.0,” enacted in late 2022, click here, here, and here.
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