12/19/2023 in Accountant

IRS Announces Retirement Savings Limits for 2024

The IRS recently announced increases to retirement plan contributions, effective for the 2024 tax year. These increases can be a big benefit to taxpayers who are saving for retirement by allowing additional funds to be put into 401K and IRA programs. You’ll want to make the necessary changes to your retirement plans by notifying your employer or payroll service to increase your retirement contributions at the beginning of the year.

The 2024 Retirement Savings Limits are as follows:

401(k) Employee Contribution$23,000$22,500
401(k) Employee Catch-Up (Over Age 50)$7,500$7,500
IRA Contribution$7,000$6,500
Simple IRA Employee Contribution$16,000$15,500
Simple IRA Catch-Up (Over Age 50)$3,500$3,500
Overall 401(k) Limit – Employer + Employee$69,000$66,000

To the extent that you can afford to do so, it is advisable to maximize these available retirement savings benefits. Traditional 401(k) and IRA contributions yield current-year tax savings and tax-deferred appreciation. Roth contributions do not provide a current tax benefit but do allow for tax-free appreciation and income in retirement. Contact the team at Whitt Accounting for a comprehensive review of your retirement savings and contribution strategy.