Many IRA and retirement plan limits are indexed for inflation each year. Several of these key numbers have increased once again for 2024.
How much can you save in an IRA?
The maximum amount you can contribute to a traditional IRA or a Roth IRA in 2024 will be $7,000 (or 100% of your earned income, if less), up from $6,500 in 2023. The maximum catch-up contribution for those age 50 or older remains $1,000. You can contribute to both a traditional IRA and a Roth IRA in 2024, but your total contributions cannot exceed these annual limits.
Can you deduct your traditional IRA contributions?
If you (or if you’re married, both you and your spouse) are not covered by a work-based retirement plan, your contributions to a traditional IRA are generally fully tax deductible.
If you’re married, filing jointly, and you’re not covered by an employer plan but your spouse is, you may generally claim a full deduction if your modified adjusted gross income (MAGI) is $230,000 or less (up from
$218,000 or less in 2023). Your deduction is limited if your MAGI is between $230,000 and $240,000 (up from $218,000 and $228,000 in 2023) and eliminated if your MAGI is $240,000 or more (up from $228,000 in 2023).
For those who are covered by an employer plan, deductibility depends on income and filing status. If your filing status is single or head of household, you can fully deduct your IRA contribution in 2024 if your MAGI is $77,000 or less (up from $73,000 in 2023). If you’re married and filing a joint return, you can fully deduct your contribution if your MAGI is $123,000 or less (up from $116,000 in 2023). For taxpayers earning more than these thresholds, the following phaseout limits apply.
If your 2024 federal income tax filing status is:
Single or head of household
- Your IRA deduction is limited if your MAGI is between: $77,000 and $87,000
- Your deduction is eliminated if your MAGI is: $87,000 or more
Married filing jointly or qualifying window(er)
- Your IRA deduction is limited if your MAGI is between: $123,000 and $143,000 (combined)
- Your deduction is eliminated if your MAGI is: $143,000 or more (combined)
Married filing separately
- Your IRA deduction is limited if your MAGI is between: $0 and $10,000
- Your deduction is eliminated if your MAGI is: $10,000 or more
Can you contribute to a Roth IRA?
The income limits for determining whether you can contribute to a Roth IRA will also increase in 2024. If your filing status is single or head of household, you can contribute the full $7,000 ($8,000 if you are age 50 or older) to a Roth IRA if your MAGI is $146,000 or less (up from $138,000 in 2023). And if you’re married and filing a jointreturn, you can make a full contribution if your MAGI is $230,000 or less (up from $218,000 in 2023). For taxpayers earning more than these thresholds, the following phaseout limits apply.
If your 2024 federal income tax filing status is:
Single or head of household
- Your Roth IRA contribution is limited if your MAGI is between: $146,000 and $161,000
- You cannot contribute to a Roth IRA if your MAGI is: $161,000 or more
Married filing jointly or qualifying window(er)
- Your Roth IRA contribution is limited if your MAGI is between: $230,000 and $240,000
- You cannot contribute to a Roth IRA if your MAGI is: $240,000 or more (combined)
Married filing separately
- Your Roth IRA contribution is limited if your MAGI is between: More than $0 but less than $10,000
- You cannot contribute to a Roth IRA if your MAGI is: $10,000 or more
How much can you save in a work-based plan?
If you participate in an employer-sponsored retirement plan, you may be pleased to learn that you can save even more in 2024. The maximum amount you can contribute (your “elective deferrals”) to a 401(k) plan will increase to $23,000 in 2024 (up from $22,500 in 2023). This limit also applies to 403(b) and 457(b) plans, as well as the Federal Thrift Savings Plan. If you’re age 50 or older, you can also make catch -up contributions of up to $7,500 to these plans in 2024 (unchanged from 2023). [Special catch -up limits apply to certain participants in 403(b) and 457(b) plans.]
The amount you can contribute to a SIMPLE IRA or SIMPLE 401(k) will increase to $16,000 in 2024 (up from $15,500 in 2023), and the catch-up limit for those age 50 or older remains $3,500. (Note that in 2024, new rules take effect that permit certain small employers to allow additional contributions.)
Plan type:
401(k), 403(b), government 457(b), Federal Thrift Savings Plan
- 2024 deferral limit: $23,000
- Catch-up limit: $7,500
SIMPLE plans
- 2024 deferral limit: $16,000
- Catch-up limit: $3,500
If you participate in more than one retirement plan, your total elective deferrals can’t exceed the annual limit ($23,000 in 2024 plus any applicable catch-up contributions). Deferrals to 401(k) plans, 403(b) plans, and SIMPLE plans are included in this aggregate limit, but deferrals to Section 457(b) plans are not. For example, if you participate in both a 403(b) plan and a 457(b) plan, you can save the full amount in each plan — a total of $46,000 in 2024 (plus any catch-up contributions).
The maximum amount that can be allocated to your account in a defined contributionplan [for example, a 401(k) plan or profit-sharing plan] in 2024 is $69,000 (up from $66,000 in 2023) plus age 50 or older
catch-up contributions. This includes both your contributions and your employer’s contributions. Special rules apply if your employer sponsors more than one retirement plan.
Finally, the maximum amount of compensation that can be taken into account in determining benefits for most plans in 2024 is $345,000 (up from $330,000 in 2023), and the dollar threshold for determining highly compensated employees (when 2024 is the look-back year) increases to $155,000 (up from $150,000 when 2023 is the look-back year).
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.
The information provided is not intended to be a substitute for specific individualized tax planning or legal advice. We suggest that you consult with a qualified tax or legal professional.
LPL Financial Representatives offer access to Trust Services through The Private Trust Company N.A., an affiliate of LPL Financial.
This article was prepared by Broadridge.
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