New Retirement Contribution Limits for 2026 Under the One Big Beautiful Bill Act

The One Big Beautiful Bill Act, enacted on July 4, 2025, raised retirement contribution limits for the 2026 tax year and introduced several new savings options for American workers and families.

For 401(k), 403(b), and 457 plans, the standard employee contribution limit is now $24,500. Workers aged 50 and older can contribute an additional $8,000 as a catch-up contribution, for a total of $32,500. Workers aged 60 to 63 qualify for a higher catch-up of $11,250, bringing their total to $35,750.

For Traditional and Roth IRAs, the standard limit is $7,500, with a $1,100 catch-up for those 50 and older, for a total of $8,600.

The law also introduced "Trump Accounts," a new tax-advantaged savings vehicle for children under 18. Children born between 2025 and 2028 receive a federally funded $1,000 seed contribution. Parents, relatives, and employers can contribute up to $5,000 per year. These accounts convert to Traditional IRAs when the child turns 18.

The estate tax exemption increased to $15 million per person for 2026, shifting the focus for many families from tax-mitigation strategies toward broader legacy and beneficiary management.

Financial planners say the changes require a review of existing retirement strategies, particularly for workers in their early 60s who can now take advantage of the higher catch-up contribution window.