[Updated on October 21, 2022 after the IRS announced the official numbers.]
Retirement plan contribution limits are adjusted for inflation every year. Inflation has been at elevated ranges in latest months. Most contribution limits and earnings limits will go up in 2023.
Earlier than the IRS publishes the official numbers in late October or early November, I used to be in a position to make my very own calculations utilizing the revealed inflation numbers and going by the identical guidelines the IRS makes use of as stipulated by regulation. The official announcement from the IRS on October 21, 2022 confirmed my calculations. I’ve maintained a report of 100% accuracy ever since I began doing these calculations.
2022 2023 401k/403b/457/TSP Elective Deferral Restrict
401k/403b/457/TSP contribution restrict will go up by $2,000 from $20,500 in 2022 to $22,500 in 2023. This restrict often goes up by $500 at a time however larger inflation is making it go 4 steps in a single 12 months.
In case you are age 50 or over by December 31, the catch-up contribution restrict will go up by $1,000 from $6,500 in 2022 to $7,500 in 2023.
Employer match or profit-sharing contributions aren’t included in these limits. Should you work for a number of employers in the identical 12 months or in case your employer gives a number of plans, you’ve one single worker contribution restrict for 401k, 403b, and TSP throughout all plans.
The 457 plan restrict is separate from the 401k/403b/TSP restrict. You possibly can contribute the utmost to each a 401k/403b/TSP plan and a 457 plan.
2022 2023 Annual Additions Restrict
The full employer plus worker contributions to all outlined contribution plans by the identical employer will improve by $5,000 from $61,000 in 2022 to $66,000 in 2023.
The age-50-or-over catch-up contribution is separate from this restrict. Should you work for a number of employers in the identical 12 months, you’ve a separate annual additions restrict for every unrelated employer.
2022 2023 SEP-IRA Contribution Restrict
The SEP-IRA contribution restrict is at all times the identical because the annual additions restrict for a 401k plan. It should additionally improve by $5,000 from $61,000 in 2022 to $66,000 in 2023.
As a result of the SEP-IRA doesn’t permit worker contributions, until your self-employment earnings is effectively above $200,000, you’ve the next contribution restrict when you use a solo 401k. See Solo 401k When You Have Self-Employment Revenue.
2022 2023 Annual Compensation Restrict
The utmost annual compensation that may be thought of for making contributions to a retirement plan is at all times 5x the annual additions restrict. Subsequently the annual compensation restrict will improve by $25,000 from $305,000 in 2022 to $330,000 in 2023.
2022 2023 Extremely Compensated Worker Threshold
In case your employer limits your contribution as a result of you’re a Extremely Compensated Worker (HCE), the minimal compensation will go up by $15,000 from $135,000 in 2022 to $150,000 in 2023.
2022 2023 SIMPLE 401k and SIMPLE IRA Contribution Restrict
Some smaller employers provide a SIMPLE 401K or a SIMPLE IRA plan as an alternative of an everyday 401k plan. SIMPLE 401k and SIMPLE IRA plans have a decrease contribution restrict than customary 401k plans. The contribution restrict for SIMPLE 401k and SIMPLE IRA plans will go up by $1,500 from $14,000 in 2022 to $15,500 in 2023.
In case you are age 50 or over by December 31, the catch-up contribution restrict in a SIMPLE 401k or SIMPLE IRA plan will improve by $500 from $3,000 in 2022 to $3,500 in 2023.
Employer contributions to a SIMPLE 401k or SIMPLE IRA plan aren’t included in these limits.
2022 2023 Conventional and Roth IRA Contribution Restrict
The Conventional or Roth IRA contribution restrict will go up by $500 from $6,000 in 2022 to $6,500 in 2023. In case you are age 50 or over by December 31, the catch-up restrict is mounted by regulation at $1,000 in all years.
The IRA contribution restrict and the 401k/403b/TSP or SIMPLE contribution restrict are separate. You possibly can contribute the respective most to each a 401k/403b/TSP/SIMPLE plan and a standard or Roth IRA.
2022 2023 Deductible IRA Revenue Restrict
The earnings restrict for taking a full deduction in your contribution to a standard IRA whereas taking part in a office retirement will improve by $5,000 for singles, from $68,000 in 2022 to $73,000 in 2023. It should improve by $7,000 for married submitting collectively, from $109,000 in 2022 to $116,000 in 2023. The deduction utterly phases out when your earnings goes above $78,000 in 2022 and $83,000 in 2023 for singles; and for married submitting collectively, $129,000 in 2022 and $136,000 in 2023.
The earnings restrict for taking a full deduction in your contribution to a standard IRA when you find yourself not lined in a office retirement however your partner is will go up by $14,000 for married submitting collectively from $204,000 in 2022 to $218,000 in 2023. The deduction utterly phases out when your joint earnings goes above $214,000 in 2022 and $228,000 in 2023.
2022 2023 Roth IRA Revenue Restrict
The earnings restrict for contributing the utmost to a Roth IRA will go up by $9,000 for singles from $129,000 in 2022 to $138,000 in 2023. It should go up by $14,000 for married submitting collectively from $204,000 in 2022 to $218,000 in 2023.
You possibly can’t contribute something on to a Roth IRA when your earnings goes above $144,000 in 2022 and $153,000 in 2023 for singles, and $214,000 in 2022 and $228,000 in 2023 for married submitting collectively, up by $9,000 and $14,000 respectively in 2023.
2022 2023 Healthcare FSA Contribution Restrict
The Healthcare FSA contribution restrict will go up by $200 from $2,850 per individual in 2022 to $3,050 per individual in 2023.
Some employers permit carrying over some unused quantity to the next 12 months. The utmost quantity that may be carried over to the next 12 months is ready to twenty% of the annual contribution restrict. Consequently, the carryover restrict will go up by $40 from $570 per individual in 2022 to $610 per individual in 2023.
2022 2023 HSA Contribution Restrict
The HSA contribution restrict for single protection will go up by $200 from $3,650 in 2022 to $3,850 in 2023. The HSA contribution restrict for household protection will go up from $7,300 in 2022 to $7,750 in 2023. These have been introduced beforehand within the spring. Please see HSA Contribution Limits.
Those that are 55 or older by December 31 can contribute a further $1,000. In case you are married and each of you’re 55 or older by December 31, every of you’ll be able to contribute the extra $1,000, however they need to go into separate HSAs in every individual’s title.
2022 2023 Saver’s Credit score Revenue Restrict
The earnings limits for receiving a Retirement Financial savings Contributions Credit score (“Saver’s Credit score”) will improve in 2023. For married submitting collectively, will probably be $41,000 in 2022 and $43,500 in 2023 (50% credit score), $44,000 in 2022 and $47,500 in 2023 (20% credit score), and $68,000 in 2022 and $73,000 in 2023 (10% credit score).
The bounds for singles shall be at half of the boundaries for married submitting collectively, at $20,050 in 2022 and $21,750 in 2023 (50% credit score), $22,000 in 2022 and $23,750 in 2023 (20% credit score), and $34,000 in 2022 and $36,500 in 2023 (10% credit score).
All Collectively
| 2022 | 2023 | Improve | |
| Restrict on worker contributions to 401k, 403b, or 457 plan | $20,500 | $22,500 | $2,000 |
| Restrict on age 50+ catch-up contributions to 401k, 403b, or 457 plan | $6,500 | $7,500 | $1,000 |
| SIMPLE 401k or SIMPLE IRA contributions restrict | $14,000 | $15,500 | $1,500 |
| SIMPLE 401k or SIMPLE IRA age 50+ catch-up contributions restrict | $3,000 | $3,500 | $500 |
| Most annual additions to all outlined contribution plans by the identical employer | $61,000 | $66,000 | $5,000 |
| SEP-IRA contribution restrict | $61,000 | $66,000 | $5,000 |
| Extremely Compensated Worker definition | $135,000 | $150,000 | $15,000 |
| Annual Compensation Restrict | $305,000 | $330,000 | $25,000 |
| Conventional and Roth IRA contribution restrict | $6,000 | $6,500 | $500 |
| Conventional and Roth IRA age 50+ catch-up contribution restrict | $1,000 | $1,000 | None |
| Deductible IRA earnings restrict, single, lively participant in office retirement plan | $68,000 – $78,000 | $73,000 – $83,000 | $5,000 |
| Deductible IRA earnings restrict, married, lively participant in office retirement plan | $109,000 – $129,000 | $116,000 – $136,000 | $7,000 |
| Deductible IRA earnings restrict, married, partner is lively participant in office retirement plan | $204,000 – $214,000 | $218,000 – $228,000 | $14,000 |
| Roth IRA earnings restrict, single | $129,000 – $144,000 | $138,000 – $153,000 | $9,000 |
| Roth IRA earnings restrict, married submitting collectively | $204,000 – $214,000 | $218,000 – $228,000 | $14,000 |
| Healthcare FSA Contribution Restrict | $2,850 | $3,050 | $200 |
| HSA Contribution Restrict, single protection | $3,650 | $3,850 | $200 |
| HSA Contribution Restrict, household protection | $7,300 | $7,750 | $450 |
| HSA, age 55 catch-up | $1,000 | $1,000 | None |
| Saver’s Credit score earnings restrict, married submitting collectively | $41,000 (50%) $44,000 (20%) $68,000 (10%) |
$43,500 (50%) $47,500 (20%) $73,000 (10%) |
$2,500 (50%) $3,500 (20%) $5,000 (10%) |
| Saver’s Credit score earnings restrict, single | $20,500 (50%) $22,000 (20%) $34,000 (10%) |
$21,750 (50%) $23,750 (20%) $36,500 (10%) |
$1,250 (50%) $1,750 (20%) $2,500 (10%) |
Supply: IRS Discover 2021-61, Discover 2022-55.
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