401K & IRA Contribution Limits for 2019 Taxes

Here is some more good news.

Due to an increase in the cost of living the IRS increased the contribution limits for 2019 for retirement plans. The increases in the annual limit to contributions are as follows:

1) 401(k), 403(b), most 457 plans, Thrift Savings Plan: Limit increased from $18,500 to $19,000.  If you are age 50 or older and have already contributed the maximum amount to your 401(k) during the current year, you may make an additional $6,000 catch-up contribution. This is unchanged from 2018.

2) IRAs, Roth IRAs: limit increased from $5,500 to $6,000.  If you are aged 50 or older, the IRA, Roth IRA catch-up contribution limit is $1,000 which means you can contribute up to $7,000.

3) If you are self-employed for a solo 401K or a SEP IRA you can contribute yearly up to 25% of your income up to $56,000 (up from $55,000 from 2018) and up to $62,000 (includes $6,000 catch-up) if you are age 50 or older.

Note: The $6,000 catch up contribution limit for participates age 50 or older applies from the start of the year to those turning 50 at any time during the year.