The limits on the amounts that you can invest into many retirement plans, as well as the income-based phase-out limits, have been increased for 2023. The new limits are set based on your income filing status, income level, and age, and vary by plan and other available coverage as well. The new limits are as follows:
- 401(k), 403(b), most 457’s, and federal government Thrift Savings: The limit on contributions increased to $22,500, and the catch-up contribution for those over age 50 increased to $7,500.
- SIMPLE retirement plans: The limit on contributions increased to $15,500, and the catch-up contribution for those over age 50 increased to $3,000.
- IRAs: The limit on contributions increased to $6,500, and the catch-up contribution for those over age 50 remained at $1,000.
It is important to remember that for both traditional and ROTH IRAs as well as for the Saver’s Credit (retirement savings contribution credit), there are phase-out limits which will lower and then eliminate your allowances.
- Traditional IRA: The phase-out range for single filers who are covered by a work-related plan was increased to between $73,000-$83,000. For married filing jointly, the contributor covered by a work-related plan has a phase-out income range of $116,000-$136,000. For married filing jointly, the contributor who is married to someone covered by a work-related plan, the new phase-out range is $218,000-$228,000. For married filing separately, the phase-out range remains $0-$10,000.
- Roth IRA: The phase-out range for single filers was increased to between $138,000-$153,000. For married filing jointly, the new phase-out income range is $218,000-$228,000. For married filing separately, the phase-out range remains $0-$10,000.
- Saver’s Credit: The new income limit for single filers and married filing separately is $36,500 and for head of household it is now $54,750. For married filing jointly, the income limit is now $73,000.
Click HERE to learn more about the limit increases.
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