New year, new contribution limits!
The IRS has announced the new 2026 contributions limits.
These limits are extremely important to ensure your plan is compliant with IRS regulations.
The employee contribution limits for employees participating in 401(k), 403(b), and most 457 plans will be increasing to $24,500 in 2025. The catch-up contribution limit, which is only available for participants over the age of 50, will be $8,000 in 2025. The employee contribution limit total for a participant over the age of 50 is, $32,500.
The total contribution limit for employee and employer contributions is $72,000.
If your plan currently allows for the age 50 catch-up provision (only applicable if your plan is administered by ADMIN Partners), it will also now include an additional “super” catch up contribution limit for employees aged 60 to 63 and the limit for this will be $11,250 for 2026. The employee contribution limit total for a participant over the age of 50 is, $32,500. The employee contribution limit total for participants aged 60-63 is, $35,750.
In addition to the new contribution limits for 2026, another contribution consideration is that under SECURE 2.0 ACT, Highly Compensated Employees (HCEs) are required to contribute any catch-up contributions as Roth (a source type under your plan where the contribution deduction is made after taxes are withdrawn from pay). The threshold for qualifying Highly Compensated Employees will utilize the employees FICA earnings of the previous year and be subject to change year-to-year. For 2026, employees that earned $150,000 or more in FICA wages in 2025 are considered Highly Compensated for this year and thus are subject to the new rules.
For more information click below for the IRS announcement.
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Happy New Year from the entire ADMIN Partners team!