New Limits on Retirement Accounts Announced

From IRAs to 401(k)s, the limits for 2025 retirement contributions have been revealed by the IRS.

Column distributed by Hearst Connecticut Media Group.

Links to resources referenced:

• Notice 2024-80: 2025 Amounts Relating to Retirement Plans and IRAs, as Adjusted for Changes in Cost-of-Living
  • https://www.irs.gov/pub/irs-drop/n-24-80.pdf  
  • Related column excerpt:
    • “The IRS has announced the contribution limits for 401(k)s and IRAs for 2025, but there’s an additional factor this year for those who qualify and want to save more for retirement. The limits are detailed in Notice 2024-80.”
• IRS Notice 2023-62: Guidance on Section 603 of the SECURE 2.0 Act with Respect to Catch-Up Contributions
  • https://www.irs.gov/pub/irs-drop/n-23-62.pdf
  • Related column excerpts:

• IRS Notice 2023-62, released in August of 2023, indicated there would be “an administrative transition period” of two years after Dec. 31, 2023, in relation to the requirement.

• ICI Research: Ten Important Facts About Roth IRAs
  • https://www.ici.org/system/files/2022-07/ten-facts-roth-iras.pdf  
  • Related column excerpts:
    • “If you are wondering how many people have traditional or Roth IRAs, research released in 2024 by the Investment Company Institute reported that as of year-end 2023, more than 24% of U.S. households had a Roth IRA (31.9 million households). In contrast, 31% had a traditional pre-tax IRA (41.1 million), and overall, 42% of households (55.5 million) had some type of IRA. The combined IRA assets total $13.6 trillion.”
• Retirement Savings Contributions Credit (Saver’s Credit)
  • https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-savings-contributions-credit-savers-credit 
  • Related column excerpts:
  • “You can find more information on the IRS web page featuring the Saver’s Credit.”