IRS Raises 401(k) Contribution Limits for 2025

The IRS has announced new retirement contribution limits, allowing increased savings in 401(k) plans while IRA limits remain unchanged.

The 401(k) contribution limit for 2025 has been increased to $23,500, up from $23,000 in 2024.
IRA contribution limits remain at $7,000 for 2025, with no increase from the previous year.
Catch-up contributions for those 50 and older in 401(k) plans stay at $7,500, but a new higher limit of $11,250 applies for ages 60-63.
Income phase-out ranges for tax deductions on traditional and Roth IRAs have been adjusted upward for 2025.
These changes are part of the IRS's annual cost-of-living adjustments to help account for inflation.