IRS unveils IRA contribution limits for 2025 Here’s what investors need to know
The IRS has announced IRA contribution limits for 2025
The IRS has unveiled the individual retirement contribution limits for 2025.
In its announcement Friday, the agency said the 2025 IRA contribution limit will be $7,000, unchanged from 2024. IRA catch-up contributions for investors age 50 and older will also stay the same, at $1,000.
The annual individual limit applies to contributions to traditional and Roth IRAs.
The IRS also unveiled new 401(k) contribution limits, 401(k) catch-up limits for savers age 50 and older, and bigger income thresholds for Roth IRA contributions for 2025.
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Some investors can deduct pretax IRA contributions, depending on their income and whether they or a spouse have access to aworkplace retirement plan. The IRS announcement also increased the phase-out ranges for IRA deductibility in 2025.
The latest IRS update comes about one weekafter the agency revealed dozens of inflation adjustments for 2025, including federal income tax brackets, higher capital gains brackets, a bigger estate and gift tax exemption, changes to eligibility for the earned income tax credit, among others.
This story originally appeared on: CNBC - Author:Kate Dore, CFP®
