New 2025 IRS Pension Plan Limitations Announced

The IRS has released the updated Pension Plan Limitations for the 2025 Plan Year, including key adjustments that may impact your retirement planning strategy.

Defined Contribution Plans

For participants Age 49 or younger in 2025:

• 401(k) deferral limit increases to $23,500

• Total contribution limit (employee + employer): $70,000

For participants Age 50 or older in 2025:

• 401(k) deferral limit increases to $31,000

(Includes $7,500 catch-up contribution)

• Total contribution limit (employee + employer): $77,500

(Includes catch-up contribution)

Plan-Wide Limits for All Participants

• Maximum compensation limit: $350,000

• Defined Benefit / Cash Balance Plan annual limit: $280,000

These updated thresholds provide increased opportunities for tax-advantaged retirement savings in 2025. If you’re considering adjustments to your retirement plan or want to explore ways to maximize contributions, our team is here to help.