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2025 Dollar Limitations on Benefits and Contributions
With the release of Notice 2024-80, the IRS has announced the cost-of-living adjustments for pension plans and other related items for the 2025 tax year.
The 2025 table includes the special catch-up for employees aged 60-63 and the mandatory Roth treatment for catch-up deferrals. The following table shows the 2025 dollar limitations in comparison to the 2024 dollar limits.
IRAs
| Code
Section |
2024 |
2025 |
| IRA Contribution Limit – 219(b)(5)(A) |
7,000 |
7,000 |
| IRA Catch-Up Contributions - 219(b)(5)(B) |
1,000 |
1,000 |
Traditional IRA AGI Deduction Phase-out Range
| Code
Section |
2024 |
2025 |
| Joint Return |
123,000 – 143,000 |
126,000 – 146,000 |
| Single or Head of Household |
77,000 – 87,000 |
79,000 – 89,000 |
Roth IRA AGI Phase-out Range
| Code
Section |
2024 |
2025 |
| Joint Return |
230,000 – 240,000 |
236,000 – 246,000 |
| Single or Head of Household |
146,000 – 161,000 |
150,000 – 165,000 |
SEP
| Code
Section |
2024 |
2025 |
| SEP Minimum Compensation - 408(k)(2)(C) |
750 |
750 |
| SEP Maximum Compensation - 408(k)(3)(C) |
345,000 |
350,000 |
SIMPLE Plans
| Code
Section |
2024 |
2025 |
| SIMPLE Maximum Contributions - 408(p)(2)(E) |
16,000 |
16,500 |
| Catch-up Contributions - 414(v)(2)(B)(ii) |
3,500 |
3,500 |
| 414 (v)(2)(e)(ii) Special catch-up limit for employees aged 60, 61, 62, and 63 in 2025 |
N/A |
5,250 |
| 414 (v)(2)(B)(iii) Catch-up for electing SIMPLE Plans with increased employer contributions or matching |
3,850 |
3,850 |
401(k), 403(b), Profit-Sharing Plans, etc.
| Code
Section |
2024 |
2025 |
| Annual Compensation - 401(a)(17)/404(l) |
345,000 |
350,000 |
| Elective Deferrals - 402(g)(1) |
23,000 |
23,500 |
| Catch-up Contributions - 414(v)(2)(B)(i) |
7,500 |
7,500 |
| Defined Contribution Limits - 415(c)(1)(A) |
69,000 |
70,000 |
| ESOP Limits - 409(o)(1)(C)
/ 5-Year Distribution Amounts |
1,380,000
/ 275,000 |
1,415,000 / 280,000 |
| 414 (v)(2) Special catch-up limit for employees aged 60, 61, 62, and 63 in 2025 |
N/A |
11,250 |
| 414 (v)(7)(a) Roth catch-up wage threshold in 2024 to determine whether 2025 catch-ups must be Roth (Roth catch-up deferred until 2026 (IRS Notice 2023-62) |
N/A |
145,000 |
Other
| Code
Section |
2024 |
2025 |
| QLAC [Reg 1.401(a)(9)] |
200,000 |
210,000 |
| HCE Threshold – 414(q)(1)(B) |
155,000 |
160,000 |
| Defined Benefit Limits - 415(b)(1)(A) |
275,000 |
280,000 |
| Key Employee - 416(i)(1)(A)(i) |
220,000 |
230,000 |
| 457 Elective Deferrals - 457(e)(15) |
23,000 |
23,500 |
| Control Employee - 1.61-21(f)(5)(i) |
135,000 |
140,000 |
| Control Employee - 1.61-21(f)(5)(iii) |
275,000 |
285,000 |
| Social Security Taxable Wage Base |
168,600 |
176,000 |
For additional information, please contact Dave Mosier, Nadia Havard, or Brian Seelinger.
David M. Mosier's practice includes business and tax transactions, retirement benefits, designing and drafting of employee pension and welfare benefit plans, and more.
dmosier@kmgslaw.com
814-923-4878
Nadia A. Havard concentrates her practice in all areas of qualified and nonqualified retirement plans and employee benefits; transfer taxes; fiduciary income tax and trust administration; business; as well as estate planning and administration. She also helps nonprofits obtain and maintain their tax-exempt status.
nhavard@kmgslaw.com
814-923-4855
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