Independent employee benefit consulting · West Chester, PA
Plan Limits
Maximum benefits and contributions for qualified retirement plans, 2015 through 2025.
At a Glance
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Key limits for 2025
$23,500Elective deferrals — 401(k) & 403(b)
$7,500Catch-up contributions (age 50+)
$70,000Annual contribution limit
$350,000Annual compensation limit
Maximum benefits & contributions, 2015–2025
| Limit | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Elective Deferrals — 401(k) & 403(b) | $23,500 | $23,000 | $22,500 | $20,500 | $19,500 | $19,500 | $19,000 | $18,500 | $18,000 | $18,000 | $18,000 |
| Annual Benefit Limit | $280,000 | $275,000 | $265,000 | $245,000 | $230,000 | $230,000 | $225,000 | $220,000 | $215,000 | $210,000 | $210,000 |
| Annual Contribution Limit | $70,000 | $69,000 | $66,000 | $61,000 | $58,000 | $57,000 | $56,000 | $55,000 | $54,000 | $53,000 | $53,000 |
| Annual Compensation Limit | $350,000 | $345,000 | $330,000 | $305,000 | $290,000 | $285,000 | $280,000 | $275,000 | $270,000 | $265,000 | $265,000 |
| 457(b) Deferral Limit | $23,500 | $23,000 | $22,500 | $20,500 | $19,500 | $19,500 | $19,000 | $18,500 | $18,000 | $18,000 | $18,000 |
| Highly Compensated Threshold | $160,000 | $155,000 | $150,000 | $135,000 | $130,000 | $130,000 | $125,000 | $120,000 | $120,000 | $120,000 | $120,000 |
| SIMPLE Contribution Limit | $16,500 | $16,000 | $15,500 | $14,000 | $13,500 | $13,500 | $13,000 | $12,500 | $12,500 | $12,500 | $12,500 |
| SEP Coverage Limit | $750 | $750 | $750 | $650 | $650 | $600 | $600 | $600 | $600 | $600 | $600 |
| SEP Compensation Limit | $350,000 | $345,000 | $330,000 | $305,000 | $290,000 | $285,000 | $280,000 | $275,000 | $270,000 | $265,000 | $265,000 |
| Income Subject to Social Security | $176,100 | $168,600 | $160,200 | $147,000 | $142,800 | $137,700 | $132,900 | $128,400 | $127,200 | $118,500 | $118,500 |
| Top-Heavy Plan Key Employee Comp | $230,000 | $220,000 | $215,000 | $200,000 | $185,000 | $185,000 | $180,000 | $175,000 | $175,000 | $170,000 | $170,000 |
| Catch-Up Contributions | $7,500 | $7,500 | $7,500 | $6,500 | $6,500 | $6,500 | $6,000 | $6,000 | $6,000 | $6,000 | $6,000 |
| Age 60–63 Catch-Up Contributions | $11,250 | — | — | — | — | — | — | — | — | — | — |
| SIMPLE Catch-Up Contributions | $3,500 | $3,500 | $3,500 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 |
| Age 60–63 SIMPLE Catch-Up | $5,250 | — | — | — | — | — | — | — | — | — | — |
| Pension-Linked Emergency Savings Accts | $2,500 | — | — | — | — | — | — | — | — | — | — |
Source: Maximum Benefit and Contribution Limits 2015 through 2025, plansponsor.com, November 2024.
Definitions
Understanding the limits
- Elective Deferral Limit
- The maximum contribution that can be made on a pre-tax basis to a 401(k) or 403(b) plan (Internal Revenue Code section 402(g)(1)).
- Annual Benefit Limit
- The maximum annual benefit that can be paid to a participant (IRC section 415): the lesser of the dollar limit or 100% of the participant’s average compensation, generally the high three consecutive years of service.
- Annual Contribution Limit
- The maximum annual contribution that can be made to a participant’s account (IRC section 415): the lesser of the dollar limit or 100% of compensation, applied to employee contributions, employer contributions and forfeitures combined.
- Annual Compensation Limit
- A plan cannot consider any employee compensation above this amount when calculating contribution allocations (401(a)(17)). It also applies to the Annual Benefit Limit and to certain nondiscrimination tests.
- 457 Deferral Limit
- A similar restriction applied to certain government plans (457 plans).
- Highly Compensated Threshold
- The minimum compensation level used to determine highly compensated employees for nondiscrimination testing (section 414(q)(1)(B)).
- SIMPLE Contribution Limit
- The maximum annual contribution to a SIMPLE (Savings Incentive Match Plan for Employees) plan, a simplified plan for small businesses that requires employer matching or nonelective contributions.
- SEP Coverage & Compensation Limits
- The coverage limit is the minimum earnings for coverage by a Simplified Employee Pension plan; the compensation limit applies when determining the maximum contributions to the plan.
- Top-Heavy Key Employee Compensation
- A compensation limit added by EGTRRA, used to identify key employees for top-heavy plan testing.
- Catch-Up Contributions
- Under EGTRRA, individuals aged 50 or over can make additional “catch-up” contributions above the regular limits, including SIMPLE catch-up deferrals.
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