401(k) and IRA Contribution Limits for 2023 January 9, 2023
The IRS has announced the contribution limits for 401(k)s and IRAs for the year 2023. These limits can greatly affect how much you can save for your retirement and the tax benefits you can receive.
- 401(k) contribution limits for 2023
- For 2023, the annual contribution limit for 401(k)s, 403(b)s, most 457 plans, and Thrift Savings Plan is $22,500, up from $20,500 in 2022.
- Individuals above the age of 50 are also eligible for catch-up contributions to their 401(k). This means that these individuals can contribute above the $22,500 limit. The IRS increased the catch-up contribution value in 2023, from $6,500 in 2022 to $7,500. In total, employees above the age of 50 can contribute up to $30,000 to their 401(k). The IRS did not raise catch-up contributions for traditional or Roth IRAs.
- IRA and Roth IRA contribution limits for 2023
- For people who have a retirement account outside of their employer, annual contribution limits have increased for both traditional IRAs and Roth IRAs. In 2023, eligible individuals can contribute up to $6,500, up from $6,000, to their IRAs.
- Roth IRAs have income limits, so individuals making above a certain income threshold are eligible for reduced contributions. Individuals who make above the upper range of that threshold are not eligible at all.
- In 2023, the income phase-out range for single filers is $138,000 to $153,000. For married couples filing jointly, it’s $218,000 and $228,000.