Tax officials (IRS) are going to change the 401(k) limit soon. It is going to go up to $23,500 in 2025 to be exact. The limit stays at $7,000 if you have an IRA, though.
Remember that the IRS set the maximum amount you could put into a 401(k) savings account in 2024 as $23,000. Since it will only go up by $500, the boost won’t be very big.
IRS highlight of changes for 2025
This year, the IRS will change the maximum amount that can be put into a 401(k). There are also some other important changes that taxpayers should be aware of.
For example, like the 401(k), the maximum amount that employees can put into the 403(b), the federal government’s Thrift Savings Plan, and the government 457 plans will go up to $23,500 per year.
As of 2025, people aged 50 and up may be interested in knowing how much they can put into their 401(k). It’s too bad it stays the same, because it will still be $7,500 in 2025 for
- 401(k)
- 403(b)
- gov. 457 plans
- Fed Thrift Savings plans
Hence, 50-year-olds and older can contribute up to $31,000 per year.
IRS unveils higher catch-up contribution limit for employees 60-63
People aged 60, 61, 62, and 63 who have 401(k), 403(b), gov. 457, or Fed Thrift Savings plans should be happy. The most they can contribute to catch up will go up to $11,250.
Just so you know, it’s only $7,500 in 2024. People between the ages of 60 and 63 who are eligible and have enough money will be able to put in $3,750 more than they could in 2024. You can be sure that it will come in handy when you retire.
Those of you who are 50 years or older and have an IRA account will still be able to put up to $1,000 into it each year in 2025. The next thing about IRA is also interesting.
The IRS said that for next year, the income ranges that determine whether you can make tax-deductible contributions to traditional IRAs, Roth IRAs, and the Saver’s Credit have all been raised.
