![\"2025](\"https:\/\/gtm.com\/business\/wp-content\/uploads\/2024\/11\/pexels-towfiqu-barbhuiya-3440682-11350082.jpg\")
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The IRS has released Notice 2024-80<\/a>, containing cost-of-living adjustments for 2025 that affect the limits employees can contribute to 401(k) plans and individual retirement accounts (IRAs).<\/p>\n The employee contribution limit for 401(k) plans in 2025 has increased to $23,500<\/strong>, up from $23,000 in 2024. Other key limits include:<\/p>\n The employee contribution limit for IRAs remains unchanged at $7,000<\/strong>.<\/p>\n The IRA catch<\/strong>\u2011up contribution limit<\/strong> for individuals aged 50 and over remains unchanged at $1,000<\/strong> for 2025 (despite this limit now including an annual cost\u2011of\u2011living adjustment because of legislation enacted at the end of 2022, referred to as \u201cSECURE 2.0\u201d).<\/p>\n The employee contribution limit for SIMPLE IRAs and SIMPLE 401(k) plans<\/strong> is increased to $16,500<\/strong>, up from $16,000. Under a change made in SECURE 2.0, individuals can contribute a higher amount to certain applicable SIMPLE retirement accounts \u2014 for 2025, this higher amount remains unchanged at $17,600<\/strong>.<\/p>\n The limits used to define a \u201chighly compensated employee\u201d and a \u201ckey employee\u201d are increased to $160,000<\/strong> (up from $155,000) and $230,000<\/strong> (up from $220,000), respectively.<\/p>\n The annual limit for defined contribution plans<\/strong> (for example, 401(k) plans, profit-sharing plans, and money purchase plans) is increased to $70,000<\/strong>, up from $69,000.<\/p>\n The annual compensation limit<\/strong> (applicable to many retirement plans) is increased to $350,000<\/strong>, up from $345,000.<\/p>\n The catch-up contribution limit<\/strong> for employees aged 50 and over who participate in 401(k), 403(b), most 457 plans, and the federal government\u2019s Thrift Savings Plan remains unchanged at $7,500<\/strong>. Under a change made in SECURE 2.0, a higher catch-up contribution limit applies to participants ages 60-63<\/strong>; these participants can contribute up to $11,250<\/strong> starting in 2025 (instead of $7,500).<\/p>\n The income ranges for determining eligibility to make deductible contributions to traditional IRAs, contribute to Roth IRAs, and claim the Saver\u2019s Credit (also known as the Retirement Savings Contributions Credit) also increased for 2025.<\/p>\n The IRS\u2019s news release<\/a> contains more details on the cost-of-living adjustments for 2025.<\/p>\n \u00a92024 Zywave, Inc. All rights reserved.<\/em><\/p>\n Does your payroll platform make it easy to manage your company’s 401k or other retirement deductions for your employees? isolved, GTM’s HCM platform <\/a>can not only make the deductions for you but also remit monies to your plan provider on your behalf, saving you time and decreasing the risk of error. Get a free quote today<\/a> to learn more.\u00a0<\/span><\/p>\n","protected":false},"excerpt":{"rendered":" The IRS has released the 2025 retirement plan limits that affect the amounts employees can contribute to 401(k) plans and IRAs.<\/p>\n","protected":false},"author":7,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[232],"tags":[219,20,26,36],"post_folder":[],"class_list":["post-16308","post","type-post","status-publish","format-standard","hentry","category-gtm-biz-blog-isolved","tag-401k","tag-employee-benefits","tag-irs","tag-retirement"],"_links":{"self":[{"href":"https:\/\/gtm.com\/business\/wp-json\/wp\/v2\/posts\/16308","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/gtm.com\/business\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/gtm.com\/business\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/gtm.com\/business\/wp-json\/wp\/v2\/users\/7"}],"replies":[{"embeddable":true,"href":"https:\/\/gtm.com\/business\/wp-json\/wp\/v2\/comments?post=16308"}],"version-history":[{"count":3,"href":"https:\/\/gtm.com\/business\/wp-json\/wp\/v2\/posts\/16308\/revisions"}],"predecessor-version":[{"id":16312,"href":"https:\/\/gtm.com\/business\/wp-json\/wp\/v2\/posts\/16308\/revisions\/16312"}],"wp:attachment":[{"href":"https:\/\/gtm.com\/business\/wp-json\/wp\/v2\/media?parent=16308"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/gtm.com\/business\/wp-json\/wp\/v2\/categories?post=16308"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/gtm.com\/business\/wp-json\/wp\/v2\/tags?post=16308"},{"taxonomy":"post_folder","embeddable":true,"href":"https:\/\/gtm.com\/business\/wp-json\/wp\/v2\/post_folder?post=16308"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Key Changes for 2025 Retirement Plans<\/h2>\n
More Information<\/h2>\n
Easily Manage Your Employee Retirement Plans in GTM’s HCM Platform<\/h2>\n