Insights

2024 New Annual Limits for Retirement and Other Benefits

01.17.24

As a participant in a 401k or 403b plan, knowing the contribution limits at the beginning of the year allows you to adjust your contribution to allocate that increase throughout the year to maximize the limits. Remember, every time you put a dollar into a qualified plan on a pretax basis, it is one less dollar you are taxed at your top marginal tax bracket. This can be a significant tax benefit. Additionally, it’s important to understand how your company match benefit is calculated. Is it done each payroll? At the end of the year?

MAI Capital’s Retirement division takes a customized approach to retirement plans, offering a complete and integrated platform that includes 401(k) services, fiduciary-based retirement plan consulting, and financial wellness programs for businesses, as well as tailored plans for individuals and families.

In November 2023, the IRS made updates for 2024. Some key takeaways are:

  • Employees can contribute up to $23,000 to their 401(k) plan for 2024 and $22,500 for 2023.
  • Anyone age 50 or over is eligible for an additional catch-up contribution of $7,500 for both 2024 and 2023.
  • The general limit on total employer and employee contributions for 2024 is $69,000 ($76,500 with catch-up).
  • The general limit on total employer and employee contributions for 2023 is $66,000 ($73,500 with catch-up).
  • The IRS adjusts retirement plan contribution limits annually for inflation.

Sources: IRS.gov

Information updated as of 1.8.24

Please send your questions, comments, and feedback to: info@mai.capital. The opinions and analyses expressed herein are subject to change at any time. Any suggestions contained herein are general, and do not take into account an individual’s or entity’s specific circumstances or applicable governing law, which may vary from jurisdiction to jurisdiction and be subject to change. Distribution hereof does not constitute legal, tax, accounting, investment, or other professional advice. Recipients should consult their professional advisors prior to acting on the information set forth herein. In accordance with certain Treasury Regulations, we inform you that any federal tax conclusions set forth in this communication, were not intended or written to be used, and cannot be used by any taxpayer, for the purposes of avoiding penalties that may be imposed by the Internal Revenue Service.

We look forward to learning about your financial goals.

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