American workers can contribute up to $22,500 in their 401(k) plans next year, up from $20,500 in 2022, the IRS announced Friday.
The increase also affects employees in 403(b) plans and most 457(b) plans, as well as the federal government's $726.8 billion Thrift Savings Plan, Washington, according to an IRS notice.
The catch-up contribution limit for employees aged 50 and over who participate in these plans increased to $7,500 from $6,500.
Meanwhile, the limit on annual contributions to an individual retirement account rose to $6,500 from $6,000. The catch-up contribution limit for savers 50 and older remains at $1,000. IRA contributions are not subject to an annual cost-of-living adjustment, the IRS noted.
