IRS raises 401(k) contribution limit to $25,500 for 2027
Notice 2026-66. Internal Revenue Service. November 12, 2026.
In 2027, you can contribute up to $25,500 to your 401(k) or equivalent plan. The IRA limit remains at $7,500. Inflation? What inflation?
IRS Action
Notice 2026-66 establishes the 2027 inflation-adjusted limits for retirement contributions, pension benefits, compensation levels, and certain distributions. It also increases the income ranges that determine eligibility for traditional IRA deductions, Roth IRA contributions, and the continuing Saver's Credit for eligible ABLE account contributions.
Why It Matters
The increases implement existing law. This notice supplies annual indexed amounts. It does not create new contribution rights or change the underlying eligibility requirements.
Catch-up contributions require separate age and wage checks. These additional contributions for eligible older participants carry different limits for ages 50 and older and ages 60 through 63. The Roth treatment test for 2027 uses 2026 wages.
IRA eligibility expands without a higher contribution ceiling. Higher income ranges allow some taxpayers to retain a traditional IRA deduction or make a direct Roth IRA contribution at income levels that exceeded the corresponding 2026 ranges.
The Saver’s Credit figures have a narrower application in 2027. Saver’s Match replaces that credit for qualifying retirement contributions. The notice’s continuing Saver’s Credit thresholds apply to eligible ABLE account contributions.
Workplace Contribution Limits
The principal limits change as follows:
Regular employee contributions: The limit for most 401(k) and 403(b) plans and the federal Thrift Savings Plan rises from $24,500 to $25,500. The separate annual deferral limit for section 457 plans also rises to $25,500.
General catch-up contributions: The ordinary limit for eligible participants age 50 or older rises from $8,000 to $8,500. Adding that amount to the regular limit raises the combined ceiling to $34,000 for eligible participants in plans that permit these contributions.
Catch-up contributions at ages 60 through 63: Participants who attain age 60, 61, 62, or 63 during 2027 have a higher catch-up ceiling of $11,750, up from $11,250. This amount replaces the ordinary catch-up ceiling and raises the combined limit to $37,250.
Total defined contribution plan additions: The dollar ceiling under section 415(c) rises from $72,000 to $75,000.
The $75k cap applies to total annual additions (your contributions, your employer's contributions, and any windfalls from other accounts). You can't contribute more than your actual pay, and catch-up contributions don't count towards that cap. Your plan may also have a lower limit simply because it can.