Retirement Plan Limits for 2023

Retirement Plan Limits for 2023

The IRS has announced increased retirement plan limits for 2023 contributions as well as limits on contributions to health savings accounts. These new limits reflect the recent increase in inflation, clocking in at 8.2% over the past year. Higher contribution limits mean more opportunities for taxpayers to save on their taxes while putting away money for retirement and future health care expenses.

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401K Contribution Limit

The annual contribution limit for 401(k)s, 403(b)s, and most 457 plans is raised to $22,500 in 2023. Individuals above the age of 50 are also eligible for catch-up contributions of up to $7,500 in addition to the $22,500 annual limit.

IRA Contribution Limit

The IRS also increased retirement account contribution limits for both traditional IRA and Roth IRAs. The 2023 contribution limit for IRA plans is $6,500. There is no increase in 2023 for IRA catch-up contribution limits, which remain at $1,000.

There are income limits on Roth IRAs. Individuals who make above a specified threshold have lower contribution limits and individuals whose income falls above these thresholds are not eligible to make Roth IRA contributions at all. In 2023, the income phase-out range for single filers is increased from $138,000 to $153,000. For married couples filing jointly, it’s $218,000 to $228,000.

SIMPLE Retirement Plan Limits

The amount individuals can contribute to their SIMPLE retirement accounts is increased to $15,500, up from $14,000. The 2023 catch-up contribution limit for SIMPLE retirement accounts is $3,500.

For more information on retirement account contribution limits and deduction phase-out limits, visit the IRS website.

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2023-11-01T13:48:40+00:00December 14th, 2022|Employees, Individual, IRAs & 401ks, Retirement|

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