Realistic Money · New on the Books · November 14, 2026
The 2027 retirement limits: $25,500 for a 401(k), $7,500 for an IRA, and who can put in more
The IRS raised the workplace plan limit by $1,000 on Thursday and left the IRA limit where it was. The catch-up amounts by age, the new income ranges for Roth and deductible IRAs, and what a bigger contribution does to two Magnolia paychecks.
By The Magnolia Standard · Published November 14, 2026
Last Saturday the 2027 tax brackets were out and the retirement limits were not. On Thursday the IRS filled in the rest, in news release IR-2026-136 and Notice 2026-66. These numbers apply to money put in during 2027, starting with the first paycheck in January.
The limits
| Account | 2026 | 2027 |
|---|---|---|
| 401(k), 403(b), government 457, Thrift Savings Plan | $24,500 | $25,500 |
| Extra for age 50 and over in those plans | $8,000 | $8,500 |
| Extra for ages 60 to 63 instead | $11,250 | $11,750 |
| IRA | $7,500 | $7,500 |
| Extra IRA amount, age 50 and over | $1,100 | $1,100 |
| SIMPLE plan | $17,000 | $17,500 |
Put together, someone 50 or older can put up to $34,000 into a workplace plan in 2027. Someone who is 60, 61, 62 or 63 during the year can put in up to $37,250.
The income ranges that moved
Some IRA rules turn on income. Inside each range the benefit shrinks; above it, it is gone. The 2027 ranges, from the IRS release:
- Deducting a traditional IRA, single, covered by a plan at work: $83,000 to $93,000 (was $81,000 to $91,000).
- Married filing jointly, the contributor covered at work: $133,000 to $153,000 (was $129,000 to $149,000).
- Not covered at work, but married to someone who is: $250,000 to $260,000.
- Contributing to a Roth IRA, single or head of household: $158,000 to $173,000. Married filing jointly: $250,000 to $260,000.
- Saver's Credit income limit: $83,000 for a married couple, $62,250 for a head of household, $41,500 for a single filer.
If neither spouse has a retirement plan at work, the traditional IRA deduction has no income limit at all.
Two Magnolia paychecks, worked
A single 45-year-old in 77354 earning $90,000. After the 2027 standard deduction, the last dollars of that income sit in the 22% bracket, on the 2027 brackets. If this person already puts in the 2026 maximum and moves to the new one, the extra $1,000 into a traditional 401(k) lowers federal income tax by about $220 and take-home pay by about $780 over the year. The same $1,000 into a Roth 401(k) is taxed now: take-home falls by the full $1,000, and qualified withdrawals later come out tax-free. Texas has no state income tax to add on either side.
A married couple, ages 61 and 58, each with a plan at work. The 61-year-old can put in up to $37,250 next year and the 58-year-old up to $34,000. If their joint income is $112,500, about the 77354 median, it sits below the $133,000 start of the phase-out, so a traditional IRA contribution is fully deductible for either of them on top of the workplace plan.
The arithmetic is ours and leaves out any employer match, which does not count toward the employee limit. A plan's own rules can be stricter than the IRS limits.
If nobody does anything
A payroll election set as a percentage keeps taking that percentage. A raise in January raises the dollars with it, up to the new cap. The higher limit matters only to someone who would otherwise reach $24,500. An election set as a flat dollar amount stays at that amount until it is changed.
Things to check
- Whether the payroll election is a percentage or a dollar amount, on the plan's website or the pay stub.
- The birth year. The ages 60 to 63 amount applies for the calendar year someone reaches one of those ages.
- Box 12 of the W-2 that arrives in January, which shows the 2026 total actually contributed.
- Whether the plan offers a Roth option. Not every plan does.
The rest of the week's numbers are in Saturday's recap.
How this column is made. Realistic Money runs every Saturday. It gathers numbers published by sources we name and link, and explains what they might mean for a household around here. It is not financial, tax, or legal advice. The paper holds no position in anything mentioned and takes no payment for inclusion. If a number is wrong, write editor@themagnoliastandard.news and we correct it with a note.
Also this Saturday
The week inflation ran hot, stocks won back their loss and Congress passed the VA raise
Consumer prices rose 0.4% in October and the S&P 500 still gained 2.5% for the week. Gold had its worst week since June, Bitcoin fell below $70,000, and mortgages eased for a fourth week. Congress sent the 3.6% veterans raise toward the President, and the IRS set next year's 401(k) limit. What it adds up to here.
The VA raise passed Congress: what 3.6% does to a disability check, rating by rating
The House passed the veterans cost-of-living bill on November 9 and the Senate on Veterans Day, both by voice vote. It raises VA disability compensation and survivors' payments by the same 3.6% Social Security gets, effective December 1. Where the bill stands, the math at five ratings, and what it does not touch.
Giving to charity without itemizing: the new $1,000 deduction, the December 31 line and the receipts
Starting with this year's gifts, a household that takes the standard deduction can still deduct cash given to charity: up to $1,000, or $2,000 for a married couple. What counts, what does not, the records the IRS lists, and the tax math on two households in 77354.