IRS Increases Amount You Can Pay Into Your 401k in 2026
The Internal Revenue Service (IRS) has released its updated retirement savings limits for 2026, announcing higher contribution caps for a range of tax-advantaged accounts.
Why It Matters
In a news release issued Thursday, the agency said individuals would be able to set aside more money in their workplace retirement plans next year, marking the largest increase in two years.
What To Know
According to the IRS, the maximum amount workers can contribute to their 401(k) plans will rise to $24,500 in 2026, up from $23,500 in 2025. The same limit applies to 403(b) accounts, most 457 plans and the federal Thrift Savings Plan. The agency said that the increase was double the $500 annual adjustments seen in both 2024 and 2025.
The IRS also outlined new catch-up contribution rules for older savers. People aged 50 and over will be able to contribute an additional $8,000 to their 401(k) plans next year, compared with $7,500 in 2025. The enhanced catch-up provision provided under the 2024 Secure 2.0 Act for individuals aged 60 to 63 remains unchanged at $11,250, which is added on top of the standard 2026 deferral limit.
For individual retirement accounts, the catch-up contribution for those 50 and older increases to $1,100, up from $1,000 for 2025. The IRS is also boosting the standard IRA contribution limit, which will climb to $7,500, compared with $7,000 this year.
The agency is raising income thresholds for Roth IRA eligibility as well. For 2026, individuals filing as single or as heads of household will see the phase-out range shift to $153,000 to $168,000, up from $150,000 to $165,000. Married couples filing jointly will have a phase-out range of $242,000 to $252,000, compared with $236,000 to $246,000 for 2025. The range for married individuals filing separately – $0 to $10,000 – does not adjust annually and remains the same.
The IRS also increased income limits for the Saver’s Credit, a tax benefit intended to help low- and moderate-income workers save for their retirement. For 2026, the credit applies to those earning up to $80,500 for married couples filing jointly, $60,375 for heads of household and $40,250 for single filers and married couples filing separately.
What People Are Saying
Financial experts say the expanded limits may offer valuable opportunities for workers looking to strengthen their long-term savings.
Lisa Featherngill, national director of strategic wealth and business advisory at Comerica Wealth Management, told Newsweek: “The new 2026 retirement plan limits give people more room to save, which is especially helpful as retirement gets longer and more expensive. Higher limits for 401(k), 457, and similar plans – along with bigger catch-up contributions – make it easier for workers to put away more money each year.”
She added that the rising income threshold for after-tax contributions may prompt higher earners to revisit their savings strategy: “Since the income threshold for after-tax contributions is increasing to $150,000 and Roth catch-up rules are expected to apply, higher earners should take a moment to review how they’re contributing. A quick check-in with an advisor can help make sure they’re taking full advantage of the new limits and staying on track for their long-term goals.”
What Happens Next
The full list of changes for 2026 is available on the IRS website.