New IRS Rules for 2026 Will Allow You to Contribute More to Your 401(k) and IRA

If you’re planning to save more for retirement in 2026, you’re in luck: The IRS just announced higher contribution limits on 401(k)s and other retirement accounts for 2026.

The IRS revisits retirement account contribution limits every year and adjusts them for inflation. For 2026, most workers will be able to save up to $24,500 in their 401(k)s, not including employer matching contributions.

Although price increases have moderated since peaking at 9.1% in 2022, inflation remains elevated.

The most recent consumer price index (CPI), a benchmark metric closely watched by policymakers, showed inflation running at 3% on a year-over-year basis, a full percentage point above the Federal Reserve’s 2% long-run target. (The IRS uses the CPI for the 12-month period ending in September as the basis for its calculations.)

While high inflation is painful for American shoppers and households, it also means higher contribution thresholds and a greater cost-of-living adjustment (COLA) for Social Security beneficiaries.

401(k) contribution limits for 2026

Since defined-benefit pensions have become less common, defined-contribution retirement plans like 401(k)s have become the default retirement savings vehicle, particularly if you work in the private sector.

A 401(k) is an employer-sponsored retirement plan that lets you contribute pre-tax dollars from your earnings. This has the benefit of lowering your taxable income while increasing the amount of money that can be invested and grow over time.

Typically, you don’t pay any taxes on 401(k) contributions or earnings until you take withdrawals in retirement. Since there’s a good chance your income will be lower once you exit the workforce, you’re likely to be in a lower tax bracket, which can minimize your future tax obligations.

The IRS increased the 401(k) contribution limit by $1,000 for 2026, raising it to $24,500 from its current $23,500. The contribution deadline is Dec. 31, so if you’re aiming to hit this year’s maximum, you still have about a month and a half to do so.

Workers age 50 and up have additional opportunities to save via “catch-up” retirement account contributions. For those age 50 to 59, the IRS raised the maximum contribution amount to $8,000 for 2026, up from $7,500 this year. This means these workers will be able to contribute a total of $32,500 in 2026.

An additional change to help older Americans save more for retirement was introduced by the SECURE 2.0 Act and implemented for the first time last year. Thanks to a "super catch-up" provision, workers age 60 to 63 are allowed to contribute up to $11,250 rather than $8,000 this year. That figure will remain the same for 2026, so workers age 60 to 63 will be able to sock away up to $35,750 next year.

These 401(k) contribution limits apply to other types of employer-sponsored retirement plans, including most 403(b)s, government 457 plans and the federal government’s Thrift Savings Plan, too.

IRA contribution limits for 2026

On Thursday, the IRS also announced 2026 contribution limits for traditional individual retirement accounts (IRAs). As the name suggests, IRAs aren’t associated with any retirement benefits your employer might offer, but traditional IRAs are tax-deferred like 401(k)s, with both contributions and earnings only taxed upon withdrawal in retirement.

The 2026 IRA contribution limit is $7,500, an increase of $500. This is the first time in two years it has been raised; last year, the IRS maintained the 2024 limit of $7,000.

For workers 50 and older, the SECURE 2.0 Act also added an annual COLA to the IRA catch‑up contribution limit. For 2026, the IRS increased it to $1,100, up from $1,000 for 2025.

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