Updates for 2024

12/2023

As the calendar turns to the New Year, taxpayers can anticipate a series of changes in the IRS landscape, ushering in a fresh set of regulations and provisions that will impact both individuals and businesses alike. Here are a few important changes to know ahead of 2024:

Retirement Plan Limits

 2024 Limits2023 Limits
401(k)/403(b)/457(b) Elective Deferrals$23,000$22,500
Traditional and Roth IRA$7,000$6,500
Catch-Up Contribution (plans other than SIMPLE plans)$7,500 (no change)$7,500
SIMPLE Plan Employee Deferrals$16,000$15,500
SIMPLE Plan Catch-Up Contributions$3,500 (no change)$3,500
Plan Max. Annual Contribution – Defined Contribution Plans$69,000$66,000
Maximum Annual Benefit – Defined Benefit Plans$275,000$265,000
Compensation Limit under Section 401(a)(17)$345,000$330,000

Health Savings Account Limits

 2024 Limits2023 Limits
HSA Self-Only Coverage           $4,150$3,850
HSA Family Coverage$8,300$7,750
HSA Catch-Up Contributions (Age 55+)$1,000 (no change)$1,000

Standard Deductions*

 2024 Limits2023 Limits
Single$14,600$13,850
Married Filing Jointly$29,200$27,700
Head of Household$21,900$20,800
*an additional deduction will apply for taxpayers who are age 65+ and/or blind

Other changes for 2024:

  • In addition the changes mentioned above, 2024 will bring revisions to the tax brackets, exemptions and credits, and limitations.
  • A 3.2% cost-of-living adjustment (COLA) will be applied for Social Security retirement and disability beneficiaries.
  • The maximum amount of earnings subject to the Social Security tax (taxable maximum) will increase to $168,600.

If you’re curious how the new changes will affect your bottom line, we are here to talk about your plan. As always, we appreciate the opportunity to be of service.

We wish you a joyful and fulfilling New Year!

Sources:

https://www.irs.gov/newsroom/irs-provides-tax-inflation-adjustments-for-tax-year-2024
https://www.irs.gov/newsroom/401k-limit-increases-to-23000-for-2024-ira-limit-rises-to-7000#:~:text=WASHINGTON%20%E2%80%94%20The%20Internal%20Revenue%20Service,up%20from%20%2422%2C500%20for%202023.
https://www.irs.gov/pub/irs-drop/rp-23-34.pdf
https://www.ssa.gov/cola/

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