2023 is upon us and an important factor to tax-advantaged accounts and plans is the contribution limits the IRS sets. This year the contribution limits were increased more than they have been in the past due to historically high inflation and cost-of-living. Here is a general overview for 2023:
In 2023, for 401(k) plans the contribution limit has been increased to $22,500. This contribution limit applies to most 457 plans and 403(b)s.
For those over 50, the catch up contribution limit is increasing to $7500. So those over 50 in 2023 can contribute up to $30,000.
Defined Contribution Plans and SEPs
For these plans, the contribution limit is increasing by $5000 from 2022’s limit: $66,000.
Increasing just over a $1000, these plans can contribute $15,500. The catch-up for those over 50 has been increased to $3500.
While the over 50 catch-up limit is not being changed for IRAs, the annual contribution limit is being raised to $6500.