Key Takeaways
- Tax Year 2024 401(k) limit: $23,000 (+$7,500 catch-up age 50+).
- Tax Year 2024 IRA limit: $7,000 (+$1,000 catch-up age 50+).
- Roth IRA phase-out: $146k-$161k (single), $230k-$240k (MFJ).
- SIMPLE IRA: $16,000 (+$3,500 catch-up).
- SEP-IRA: 25% of compensation, max $69,000.
- SECURE 2.0 changes phase in through 2025 and beyond.
Qualified Retirement Plans: Tax Year 2024 Limits
Why This Matters for the Exam
Retirement plan contribution limits are heavily tested. The exam tests current-year limits for various plan types and catch-up contribution rules.
Exam Note: For the May 2025 - February 2026 testing window, you are tested on Tax Year 2024 limits.
Expect at least 3-4 questions on retirement plan limits.
401(k) / 403(b) / 457 Plans
| Limit Type | Tax Year 2024 |
|---|---|
| Employee elective deferral | $23,000 |
| Catch-up (age 50+) | +$7,500 |
| Total (age 50+) | $30,500 |
| Annual additions limit (415) | $69,000 |
Traditional and Roth IRA
| Limit Type | Tax Year 2024 |
|---|---|
| Contribution limit | $7,000 |
| Catch-up (age 50+) | +$1,000 |
| Total (age 50+) | $8,000 |
Roth IRA Income Phase-Outs
| Filing Status | Phase-Out Range (AGI) |
|---|---|
| Single | $146,000 - $161,000 |
| MFJ | $230,000 - $240,000 |
| MFS | $0 - $10,000 |
Traditional IRA Deduction Phase-Outs
If covered by employer plan:
| Filing Status | Phase-Out Range (AGI) |
|---|---|
| Single | $77,000 - $87,000 |
| MFJ (contributor covered) | $123,000 - $143,000 |
| MFJ (spouse covered) | $230,000 - $240,000 |
SIMPLE IRA
| Limit Type | Tax Year 2024 |
|---|---|
| Employee contribution | $16,000 |
| Catch-up (age 50+) | +$3,500 |
| Total (age 50+) | $19,500 |
| Employer match | Up to 3% of compensation |
SEP-IRA
| Limit Type | Tax Year 2024 |
|---|---|
| Employer contribution | Lesser of 25% of comp or $69,000 |
| Compensation limit | $345,000 |
| Employee contributions | Not allowed |
Comparison Table
| Plan | Employee Limit | Catch-Up | Employer Can Contribute |
|---|---|---|---|
| 401(k) | $23,000 | $7,500 | Yes |
| IRA | $7,000 | $1,000 | No |
| SIMPLE | $16,000 | $3,500 | Yes (required) |
| SEP | $0 | $0 | Yes (only employer) |
SECURE 2.0 Changes
| Change | Effective |
|---|---|
| Super catch-up (60-63) | 2025 |
| Roth catch-up for high earners | 2026 |
| Emergency savings accounts | 2024 |
| Student loan matching | 2024 |
Real-World Scenario
Scenario: A 55-year-old employee earns $150,000 and participates in both a 401(k) and an IRA.
- 401(k) limit: $23,000 + $7,500 catch-up = $30,500.
- IRA limit: $7,000 + $1,000 catch-up = $8,000.
- Total potential retirement savings: $38,500 in employee contributions alone.
- If employer matches: Additional employer contributions possible up to 415 limit.
On the Exam
Expect 3-4 questions on retirement limits, typically:
- 401(k) Limit Questions: "What is the 401(k) contribution limit for Tax Year 2024?"
- IRA Limit Questions: "What is the IRA limit for someone age 55?"
- Roth Phase-Out Questions: "At what AGI is Roth IRA eligibility phased out?"
- SEP Questions: "What is the maximum SEP contribution?"
The key is to remember: 401(k) = $23,000 (+$7,500). IRA = $7,000 (+$1,000). SEP = 25%/$69,000. SIMPLE = $16,000 (+$3,500).
What is the Tax Year 2024 401(k) contribution limit for someone under 50?
What is the Tax Year 2024 IRA contribution limit for someone age 55?
What is the maximum Tax Year 2024 SEP-IRA contribution?