01 Feb Retirement Plan Limits for 2025

Posted at 17:09h in 2024, 2025, Retirement by

2025 and 2024 contribution rates for employer and individual retirement accounts, including income phase-outs for IRA deductions and ROTH IRA contributions.Note that starting in 2025, there is an additional age bracket provided for “super” catch-up contributions (beyond the original 50+) for some retirement plans. This was a result of the SECURE 2.0 Act, enacted in December 2022.

 

Elective deferral and IRA contribution limits

Retirement plan catch-up limits

Note: Elective salary deferrals and catch-up contributions are not permitted in SEP plans.

Defined contribution plan limits

1 If you are self-employed, your effective contribution rate is closer to 20% of net self-employment income. Contributions are based on your net earnings from self-employment (after deducting half of your self-employment tax and your own SEP contributions). You can use this IRS link to determine contributions for yourself.

Roth IRA compensation limits - income phase-out

Note that Roth IRA compensation limits do not apply to a Roth 401(k).

Contributions to a Roth 401(k) are only subject to the plan’s deferral limits, not to income-based restrictions like those for Roth IRA.

Traditional deductible IRA income phase-out limits table

For example, for a single filer, there would be a full deduction $79,000 or less; No deduction if $89,000 or more. Based of Modified Adjusted Gross Income (MAGI)

Traditional deductible IRA income phase-out limits table

 

 

This information is general in nature, is not a complete statement of all information necessary for making an investment decision and is not a recommendation or a solicitation to buy or sell any security. Investments and strategies mentioned may not be suitable for all investors. Past performance may not be indicative of future results.

Prepared by Heart Strong Wealth Planning

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