How much can you contribute to your 401(k) and IRA in 2024?

The Internal Revenue Service recently announced what the contribution limit for 401(k) and IRA accounts will be in 2024; that is, the maximum amount that people can contribute to their plans next year.

Additionally, the tax agency issued technical guidance regarding all cost-of-living adjustments that affect limitations for pension plans and other retirement-related matters for tax year 2024.

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How much can you contribute to your 401(k) in 2024?

This year, the maximum amount people can contribute to their 401(k) plans has been $22,500 and $30,000 for people age 50 and older. However, for 2024, the contribution limit increases to $23,000 and $30,500, respectively.

These same contribution limits, $22,500 and $30,000 for people age 50 or older, also apply to 403(b) plans, most 457 plans, and the retirement plan for federal and military employees (Thrift Savings Plan) of the federal government.

Meanwhile, the catch-up contribution limit for employees age 50 or older who participate in 401(k), 403(b), most 457 plans, and the Thrift Savings Plan remains $7,500 for 2024.

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How much can you contribute to your IRA in 2024?

The annual IRA contribution limit increases by $500 from $6,500 to $7,000 by 2024. Meanwhile, the catch-up contribution limit for IRA remains $1,000 for 2024.

The IRS also reported that the amount that can be contributed to SIMPLE retirement accounts is increased from $15,000 to $16,000. On the other hand, the catch-up contribution limit for employees age 50 and older who participate in SIMPLE plans remains at $3,500 for 2024.

On the Internal Revenue Service web portal you can see all the details about the income required for Roth IRA accounts, as well as the Saver’s Credit (also known as Retirement Savings Contributions Credit).