The IRS has released the cost-of-living adjustments (COLA) applicable to qualified retirement plans for 2025. Below is an updated summary of those adjustments. The limits that increased for 2025 are shown in green.
2024 | 2025 | ||||
Maximum Compensation | $ | 345,000 | $ | 350,000 | |
Maximum Contribution Limit | 69,000 | 70,000 | |||
401(k) Salary Deferral Annual Limit | 23,000 | 23,500 | |||
SIMPLE Salary Deferral Annual Limit | 16,000 | 16,500 | |||
457/403(b) Salary Deferral Annual Limit | 23,000 | 23,500 | |||
Defined Benefit Annual Limit | 275,000 | 280,000 | |||
Covered Compensation Limits – Social Security | 168,600 | 176,100 | |||
Catch-up Contributions 401(k)/403(b)/457 | 7,500 | 7,500 | |||
Catch-up Contributions (age 60-63) 401(k)/403(b)/457 | n/a | 11,250 | |||
Catch-up Contributions SIMPLE 401(k) | 3,500 | 3,500 | |||
Catch-up Contributions SIMPLE (age 60-63) 401(k) | n/a | 5,250 | |||
Highly Compensated Employee | 155,000 | 160,000 | |||
IRA Contribution Limit | 7,000 | 7,000 | |||
IRA Catch-up Contribution Limit | 1,000 | 1,000 | |||
SEP Threshold | 750 | 750 |
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