WASHINGTON — (AP) — The IRS on Friday announced an increase to the amount individuals can contribute to their 401(k) plans in 2025 — to $23,500, up from $23,000 in 2024.
The Internal Revenue Service detailed the increases in its annual cost-of-living adjustments for pension plans and other retirement accounts.
Workers who participate in 403(b) and the federal government’s Thrift Savings Plan will also be able to increase their annual contribution to $23,500 in 2025, up from $23,000 in 2024.
Some annual contributions remain the same. The limit on annual contributions to an IRA will remain at $7,000 and the IRA catch-up contribution limit for people 50 and over remains $1,000 for 2025.
The agency last week announced increases to the standard deduction in its annual inflation adjustments for 2025. For single taxpayers and married individuals filing separately in tax year 2025, the standard deduction is rising to $15,000 — up $400 from 2024.
For …