401(k), IRA, and Roth IRA Contribution Limits for 2026

401(k), 403(b), and 457 Plan Limits for 2026

The elective deferral limit for 401(k), 403(b), and most 457(b) plans is $23,500 for 2026, an increase from $23,000 in 2025. This is the maximum amount an employee can choose to contribute from their salary on a pre-tax (traditional) or after-tax (Roth) basis. The limit is adjusted annually for inflation by the IRS under Section 402(g) of the Internal Revenue Code.

In addition to the employee deferral limit, the total contribution limit (combined employee deferrals, employer matching contributions, and employer profit-sharing contributions) is $70,000 for 2026 (up from $69,000 in 2025). This means that with employer contributions, a highly compensated employee could have up to $70,000 contributed to their 401(k) account in 2026.

For participants age 50 and older, the catch-up contribution amount is $7,500 (unchanged from 2025). This allows workers approaching retirement to contribute a total of $31,000 ($23,500 + $7,500) through salary deferrals alone. The catch-up provision was established by EGTRRA in 2001 to help older workers accelerate their retirement savings.

It is important to note that Roth 401(k) contributions count toward the same $23,500 elective deferral limit. If you split your contributions between traditional pre-tax and Roth after-tax in your 401(k), the combined total of both cannot exceed $23,500 (or $31,000 with catch-up). Employer matching contributions are always made on a pre-tax basis, regardless of whether your deferrals are traditional or Roth.

If you participate in multiple 401(k) plans (uncommon but possible when switching jobs mid-year), the $23,500 limit applies to the combined total of all your elective deferrals across all plans. This is a per-taxpayer limit, not a per-plan limit. Exceeding this limit can result in double taxation on excess deferrals unless corrected by the April 15 deadline.

For governmental 457(b) plans, a special rule allows participants to contribute up to twice the normal deferral limit in the final three years before retirement (age-based catch-up). This "special catch-up" is separate from the age 50 catch-up and allows contributions of up to $47,000 in certain circumstances.

Traditional IRA Contribution Limits for 2026

The Traditional IRA contribution limit for 2026 is $7,000, the same as 2025 (up from $6,500 in 2024). This limit applies to the total contributions you can make to all of your IRAs combined (including Roth IRAs). If you have both a Traditional IRA and a Roth IRA, the combined contributions to both cannot exceed $7,000.

Individuals age 50 and older can contribute an additional $1,000 in catch-up contributions, for a total of $8,000. The $1,000 catch-up amount has not changed in recent years, as it was not indexed for inflation when established by EGTRRA. Proposals have been made to index it, but none have been enacted.

To contribute to a traditional IRA, you must have taxable compensation (earned income) at least equal to your contribution amount. Earned income includes wages, salaries, tips, self-employment income, and alimony (for pre-2019 divorce agreements). Investment income, pension income, and Social Security benefits do not count as earned income for IRA contribution purposes.

The deductibility of traditional IRA contributions depends on your income and whether you (or your spouse) are covered by a workplace retirement plan. If neither you nor your spouse is covered by a retirement plan at work, your traditional IRA contributions are fully deductible regardless of your income level. If you are covered by a workplace plan, the deduction phases out at certain income levels (covered in the Deductible IRA section below).

One of the most powerful features of IRAs is that contributions can be made after the end of the tax year. For 2026 contributions, you have until April 15, 2027 to make your contribution. This means you can assess your tax situation and fund your IRA as part of your tax planning strategy, potentially reducing your taxable income for 2026 even after the calendar year has ended.

Spousal IRAs are also available for married couples where one spouse has little or no earned income. A non-working spouse can contribute up to the full $7,000 limit based on the working spouse's earned income, as long as the couple files a joint return and the combined earned income of both spouses is at least equal to the total contributions made.

Roth IRA Limits and Income Phase-Outs

Roth IRA contributions are subject to the same $7,000 limit ($8,000 age 50+) as traditional IRAs, but Roth IRA eligibility is also restricted by income limits. For 2026, the ability to contribute to a Roth IRA phases out based on your modified adjusted gross income (MAGI) as follows:

If your MAGI falls within the phase-out range, your maximum Roth IRA contribution is reduced proportionally. For example, if your MAGI is $157,500 as a single filer (halfway through the $150,000–$165,000 range), your maximum Roth IRA contribution would be reduced by 50%, from $7,000 to $3,500. Most tax software and retirement calculators can compute this reduction automatically.

If your income exceeds the Roth IRA phase-out limits, you may still be able to contribute to a Roth IRA using the "backdoor Roth IRA" strategy. This involves making a non-deductible Traditional IRA contribution and then converting it to a Roth IRA. The backdoor Roth strategy is legal but has specific tax implications, particularly if you have existing pre-tax IRA balances due to the pro-rata rule.

MAGI for Roth IRA purposes includes your adjusted gross income with certain add-backs: tax-exempt interest, foreign earned income exclusion, and excluded Social Security benefits. It does not include qualified Roth IRA conversions or required minimum distributions. Understanding your MAGI is essential for determining your Roth IRA eligibility.

Roth IRA contributions are made with after-tax dollars, but qualified distributions (after age 59.5 and a 5-year holding period) are completely tax-free. Roth IRAs also have no required minimum distributions (RMDs) during the original owner's lifetime, making them excellent estate planning vehicles.

For married couples filing jointly with MAGI above $246,000, no direct Roth IRA contributions are allowed. However, the non-working spouse can use the same backdoor Roth strategy independently if they have no pre-tax IRA balances. The income limits apply to the taxpayer, not per spouse.

Deductible IRA Income Limits

The deductibility of traditional IRA contributions depends on your income and whether you (or your spouse) are covered by a retirement plan at work. If you are not covered by a workplace plan, your contributions are fully deductible regardless of income. If you are covered, the deduction phases out at specific income levels:

If you are not covered by a workplace plan but your spouse is, you are treated as "not covered" for IRA deduction purposes, but the phase-out range above $236,000 still applies to your deduction. This is known as the spousal IRA phase-out and prevents high-income families from deducting IRA contributions even if the contributing spouse is not covered by a plan.

If your income falls within the phase-out range, you can calculate your reduced deduction amount using IRS worksheets in Publication 590-A. The reduction is proportional — halfway through the range means half of the $7,000 contribution is deductible. The non-deductible portion can still be contributed as a non-deductible traditional IRA contribution, and Form 8606 must be filed to track the basis.

If you cannot deduct your traditional IRA contribution due to income limits, you have several options: contribute to a Roth IRA (if eligible), make a non-deductible traditional IRA contribution, or consider a backdoor Roth IRA conversion. Each option has different tax implications that depend on your overall financial situation.

Many high earners find that the optimal strategy is to contribute to a Roth IRA (if eligible based on income) or use the backdoor Roth method, rather than making non-deductible traditional IRA contributions. Non-deductible traditional IRA contributions are generally less beneficial because the earnings are taxed as ordinary income upon withdrawal, whereas Roth IRA earnings are tax-free.

SEP IRA Limits for 2026

The Simplified Employee Pension (SEP) IRA is a retirement plan designed for self-employed individuals and small business owners. For 2026, the SEP IRA contribution limit is the lesser of 25% of compensation (or net earnings from self-employment) or $70,000 (up from $69,000 in 2025).

For self-employed individuals, the calculation is slightly different: you can contribute up to 20% of your net earnings from self-employment (after deducting half of self-employment tax and the SEP contribution itself). The 20% figure effectively reflects the 25% limit when adjusted for self-employment tax and the contribution deduction.

SEP IRAs are attractive because they allow high contribution limits with minimal administrative complexity. There are no annual filing requirements (no Form 5500), no discrimination testing, and no employee eligibility requirements for the first year. Contributions are 100% vested immediately and are tax-deductible.

To illustrate: A self-employed freelancer with $140,000 in net earnings from self-employment could contribute up to $28,000 (20% of $140,000) to a SEP IRA. Someone with $350,000 in net earnings would be capped at the $70,000 maximum limit. SEP IRAs are particularly valuable for high-income self-employed individuals who want to maximize retirement savings.

The deadline for SEP IRA contributions is the same as the tax filing deadline (including extensions), which is typically April 15 (or October 15 with an extension). This gives self-employed individuals substantial time after year-end to fund their SEP IRA and reduce their taxable income.

Unlike SIMPLE IRAs, SEP IRAs do not allow catch-up contributions for participants age 50 or older. The $70,000 limit applies to all participants regardless of age. However, SEP IRA contributions can be combined with other retirement accounts (such as a Solo 401(k) or a personal IRA) to maximize total retirement savings.

SIMPLE IRA Limits for 2026

The Savings Incentive Match Plan for Employees (SIMPLE) IRA is a retirement plan for small businesses with 100 or fewer employees. For 2026, the SIMPLE IRA contribution limit is $16,000 (unchanged from 2025). Participants age 50 and older can make additional catch-up contributions of up to $3,500, for a total of $19,500.

SIMPLE IRAs require employer contributions in one of two forms:

• Matching contributions: Up to 3% of each employee's compensation (dollar-for-dollar match on employee elective deferrals)
• Nonelective contributions: 2% of each eligible employee's compensation (regardless of whether the employee contributes)

The maximum SIMPLE IRA contribution limit (employee deferrals) is significantly lower than the 401(k) limit because SIMPLE IRAs are designed for small businesses with lower administrative costs. However, the employer contribution can add up to an additional $3,300 (3% of $110,000 max compensation) in matching or $2,200 (2%) in nonelective contributions.

One important consideration is the two-year rule for SIMPLE IRAs. If you have participated in a SIMPLE IRA for less than two years, distributions (including rollovers to other retirement accounts) are subject to a 25% penalty instead of the standard 10% early withdrawal penalty. After two years, the penalty drops to 10% for early withdrawals.

SIMPLE IRAs have lower contribution limits than SEP IRAs and 401(k)s, making them less suitable for highly compensated employees or business owners who want to maximize retirement savings. However, they are much easier to administer and have no discrimination testing requirements, making them ideal for small businesses that want to offer a retirement benefit with minimal overhead.

Employers can also switch between the matching and nonelective contribution formulas each year, providing flexibility in managing business expenses. Employees can change their deferral amounts at any time during the year (subject to plan rules), unlike 401(k) plans which typically allow changes only quarterly.

Solo 401(k) Limits for 2026

The Solo 401(k), also known as an Individual 401(k) or One-Participant 401(k), is designed for self-employed individuals with no employees (other than a spouse). It combines the features of a traditional 401(k) with the high contribution limits suitable for self-employed retirement savers. For 2026, the Solo 401(k) limits are generous and flexible:

The total contribution limit for a Solo 401(k) in 2026 is the lesser of $70,000 (the total plan limit) or 100% of compensation. This total is composed of two parts:

• Employee elective deferral: Up to $23,500 ($31,000 with age 50+ catch-up) — same as regular 401(k) limits
• Employer profit-sharing contribution: Up to 25% of compensation (20% for self-employed), with a combined maximum of $70,000

This means a self-employed individual under age 50 with sufficient income could contribute up to $23,500 as an employee deferral plus up to $46,500 as an employer profit-sharing contribution, for a total of $70,000. An individual age 50 or older could contribute up to $31,000 as employee deferrals plus up to $39,000 as employer contributions, totaling $70,000.

The Solo 401(k) offers several advantages over a SEP IRA:

• Higher contribution limits for the same income level (because employee deferrals are allowed)
• Roth contribution option (if the plan document allows it)
• Ability to take loans from the plan (up to $50,000 or 50% of the vested balance)
• Roth contributions do not reduce current taxable income, but provide tax-free growth

To set up a Solo 401(k), you must obtain an Employer Identification Number (EIN) and adopt a written plan document. Most major brokerages (Vanguard, Fidelity, Schwab) offer free Solo 401(k) plan documents. The deadline for establishing and contributing to a Solo 401(k) is generally December 31 (for employer contributions, you can contribute up to the tax filing deadline including extensions).

For self-employed individuals with significant income, the Solo 401(k) is generally the superior choice over a SEP IRA because it allows both employee deferrals and employer contributions, maximizing total retirement savings. At income levels below approximately $100,000 of net earnings, the difference between SEP IRA and Solo 401(k) contribution amounts is relatively small.

Combined 401(k) + IRA Strategy

You can contribute to both a 401(k) and an IRA in the same year, provided you have sufficient earned income. The contribution limits for 401(k) plans and IRAs are independent of each other — contributing to one does not reduce the amount you can contribute to the other. This allows for substantial total retirement savings of up to $30,500 per year (for those under 50) or $39,000 per year (age 50+).

Here is the maximum combined 2026 strategy for someone under 50:

• 401(k) elective deferrals: $23,500
• Employer 401(k) match (at 5% of $150,000 salary): $7,500
• IRA contribution (Traditional or Roth): $7,000
• Total: $38,000 ($30,500 from personal contributions plus $7,500 from employer)

For someone age 50+ with catch-up contributions:

• 401(k) elective deferrals (including $7,500 catch-up): $31,000
• Employer 401(k) match (at 5% of $150,000 salary): $7,500
• IRA contribution (including $1,000 catch-up): $8,000
• Total: $46,500 ($39,000 from personal contributions plus $7,500 from employer)

The optimal tax strategy for combining accounts depends on your current tax bracket and expected retirement tax bracket:

• High earner now, lower in retirement: Prioritize traditional 401(k) (pre-tax) to get a tax deduction now
• Lower earner now, higher in retirement: Consider Roth IRA and Roth 401(k) contributions for tax-free withdrawals later
• Middle ground: A mix of traditional and Roth contributions provides tax diversification

When deciding between Traditional and Roth IRA contributions, also consider whether your IRA contribution will be deductible. If your income is too high to deduct a Traditional IRA contribution, a Roth IRA (or backdoor Roth IRA) is generally the better option, as non-deductible traditional IRA contributions provide limited tax benefits.

For self-employed individuals, the Solo 401(k) allows even greater combined savings. With a Solo 401(k) and a personal IRA, a self-employed individual under 50 with sufficient income could save up to $77,000 ($70,000 Solo 401(k) + $7,000 IRA). At age 50+, this increases to $78,000 ($70,000 Solo 401(k) + $8,000 IRA).

Contribution Deadlines

The deadlines for retirement contributions vary by account type. Understanding these deadlines is critical because missing a deadline can mean losing the opportunity to make a contribution for a given tax year. The two key dates are December 31 (year-end) and April 15 (tax day of the following year).

401(k), 403(b), and 457(b) contributions must be made through payroll deductions during the calendar year. You cannot make 401(k) contributions after December 31 for the prior year. Your payroll deferral elections for the year must be in place, and contributions must be deducted from your paychecks during the calendar year. However, employer profit-sharing contributions can be made up to the corporate tax filing deadline (including extensions).

IRA contributions (Traditional and Roth) can be made after the end of the tax year. For 2026 contributions, you have until April 15, 2027 to make your contribution. This is one of the most valuable features of IRAs — you can calculate your tax liability first, then decide how much to contribute based on your tax situation. Many taxpayers use this "IRA season" to fine-tune their tax deductions.

SEP IRA contributions can be made by the tax filing deadline including extensions. For a calendar-year taxpayer, this means October 15, 2027 for 2026 contributions (if you file for an extension). This extended deadline gives self-employed individuals even more time to fund their SEP IRA.

SIMPLE IRA employee deferrals must be made by January 30 following the year of the deferral (60 days after year-end). Employer contributions can be made by the employer's tax filing deadline including extensions. The shortened employee deadline means employees cannot make SIMPLE IRA contributions after January 30 of the following year.

Solo 401(k) employee deferrals must be elected by December 31 of the tax year, but the contributions can be made up to the tax filing deadline (including extensions). This is different from regular 401(k) plans where deferrals must be made from each paycheck. With a Solo 401(k), you decide your deferral amount by year-end but can fund it later.

Here is a quick reference for 2026 contribution deadlines:

Saver's Credit (Retirement Savings Contributions Credit)

The Saver's Credit (officially the Retirement Savings Contributions Credit) is a non-refundable tax credit for low-to-moderate-income taxpayers who make eligible retirement contributions. For 2026, the credit can be worth up to $1,000 per individual ($2,000 for married filing jointly), depending on your income, filing status, and the amount of your retirement contributions.

The Saver's Credit rate is based on your adjusted gross income (AGI) and filing status:

The credit is calculated as a percentage of your eligible retirement contributions (up to $2,000 per individual). For example, a single filer with AGI of $18,000 who contributes $2,000 to a Traditional IRA would receive a Saver's Credit of $1,000 (50% of $2,000). The credit is non-refundable, so it can only reduce your tax liability to zero.

Eligible retirement contributions for the Saver's Credit include contributions to Traditional and Roth IRAs, 401(k), 403(b), 457(b), SEP IRA, SIMPLE IRA, and Solo 401(k) plans. Voluntary after-tax contributions to workplace plans also qualify. Rollover contributions and catch-up contributions do not qualify for the credit.

To claim the Saver's Credit, you must file Form 8880 (Credit for Qualified Retirement Savings Contributions) with your Form 1040. The credit is in addition to any deduction you receive for Traditional IRA or 401(k) contributions — you can deduct the contribution and also receive the credit.

The Saver's Credit is available to taxpayers who are at least 18 years old, not full-time students, and not claimed as a dependent on another person's tax return. The income limits are adjusted annually for inflation and are subject to change each tax year.

For taxpayers in the 10% or 12% marginal tax brackets, the Saver's Credit can effectively create a "negative tax rate" on retirement savings, making it one of the most powerful incentives for building retirement savings at lower income levels. Use our tax refund calculator to estimate how the Saver's Credit affects your total refund.

Frequently Asked Questions

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