IRS Increases Contribution Limits for Retirement Accounts
The Internal Revenue Service says that the contribution limit for employees who participate in a 401(k), 403(b) and most 457 plans, as well as the federal government’s Thrift Savings Plan, is increased from $18,500 to $19,000.
The catch-up contribution limit, which is a higher threshold for employees 50 years or older using these accounts, remains unchanged at $6,000. The changes were among several inflation adjustments announced by the IRS.
The limit on annual contributions to an IRA, which hadn’t increased since 2013, were raised to $6,000 from $5,500.
A 401(k) plan is one of the most common employer-sponsored retirement accounts. 403(b) plans is another type of retirement plan, used for public school and nonprofit employees. And 457 plans are another retirement account, more common for government employees.