2026 Cost-of-Living Adjustments for Qualified Retirement Plans
By Kimbarley A. Williams, CPA
Below is a highlights summary of the significant cost-of-living adjustments (COLA) effective for 2026. These adjustments recently announced by the Internal Revenue Service (IRS) and the Social Security Administration (SSA) have a wide-ranging impact, including the savings rate for retirement plans. Boyer & Ritter will continue to provide updates on regulatory matters impacting retirement plans in the coming year.
|
Code Section |
2026 |
2025 |
2024 |
|
401(a)(17) /404(l) Annual Compensation |
$360,000 |
350,000 |
345,000 |
|
402(g)(1) Elective Deferrals |
$24,500 |
23,500 |
23,000 |
|
408(k)(2)(C) SEP Minimum Compensation |
$800 |
750 |
750 |
|
408(k)(3)(C) SEP Maximum Compensation |
$360,000 |
350,000 |
345,000 |
|
408(p)(2)(E) SIMPLE Maximum Contributions |
$17,000 |
16,500 |
16,000 |
|
409(o)(1)(C)(ii) ESOP Limits |
$1,455,000 |
1,415,000 |
1,380,000 |
|
$290,000 |
280,000 |
275,000 |
|
|
414(q)(1)(B) HCE Threshold |
$160,000 |
160,000 |
155,000 |
|
414(v)(2)(B)(i) Catch-up Contributions |
$8,000 |
7,500 |
7,500 |
|
414(v)(2)(B)(ii) Catch-up Contributions |
$4,000 |
3,500 |
3,500 |
|
414(v)(2)(B)(iii) SIMPLE IRAs under 408(p) Age 50+ Catch-up Contributions |
$3,850 |
3,850 |
|
|
414(v)(2)(E)(i) Super Catch-up Contributions Regular Age 60-63 Super Catch-up Contributions |
$11,250 |
11,250 |
7,500 |
|
414(v)(2)(E)(ii) Catch-up Contributions SIMPLE Plans and IRAs Age 60-63 Super Catch-up Contributions |
$5,250 |
5,250 |
|
|
414(v)(7)(A) Roth Catch-up Wage Threshold |
$150,000 |
150,000 |
145,000 |
|
415(b)(1)(A) DB Limits |
$290,000 |
280,000 |
275,000 |
|
415(c)(1)(A) DC Limits |
$72,000 |
70,000 |
69,000 |
|
416(i)(1)(A)(i) Key Employee |
$235,000 |
230,000 |
220,000 |
About the Author
Kimbarley A. Williams, CPA, is a principal at Boyer & Ritter LLC and is chair of the firm’s Employee Benefit Plan Services Group. Kim has over 20 years of experience providing audit, accounting and tax services to employee benefit plans, business trade associations, charitable organizations, community foundations, and closely held businesses. Contact Kimbarley at 717-761-7210 or kwilliams@cpabr.com.
Some content borrowed with permission from BDO USA. Boyer &Ritter LLC is an independent member of the BDO Alliance USA, a nationwide association of independently owned local and regional accounting, consulting, and service firms.
