IRS Increases 401(k) Limits for 2025

Employees can put slightly more into their retirement accounts next year following an announcement from the IRS. 

IRS officials said contribution limits for 401(k), 403(b), and most 457 plans will increase to $23,500 in 2025.

That is up from $23,000 in 2024 and $22,500 in 2023, representing a comparatively small year-over-year increase.

The changes are part of the federal government cost-of-living adjustments and reflect increases in the Consumer Price Index for all urban consumers from the third quarter of 2023 to the third quarter of 2024.

Taxpayers will still be able to contribute $7,000 to an individual retirement account.

For people aged 50 and over, the catch-up contribution was amended under the SECURE 2.0 Act of 2022 to include an annual cost‑of‑living adjustment, but remains $1,000 for 2025.

For 2025, those employees will be able to contribute up to $31,000 to their plan.