Skip to main content

Don Adams & Laura Skinner

Important Changes in 2024

January 29, 2024

To maximize financial opportunities in 2024 you may find a few changes helpful including new retirement account contribution limits, a new 529 rollover IRA option, and social security cost of living increases. Let’s look at these changes individually.

401K Plans and other defined contribution plans

  • Employee contribution limits for 401K, 402B, most 457 plans and the thrift savings plan is increasing to $23,000. However, there is no increase for catchup contributions for those ages 50 and older.

IRA Contribution Limits

  • The contribution limit for IRA is increasing to $7,000. With catchup contributions remaining unchanged.

Workplace IRA Contribution Limits

  • The simple IRA employee contribution limit is increasing to $16,000. The catchup contribution for those 50 and older is an additional $3,500 making your total contribution $19,500. SEP IRA employer contribution limits are up to 25% of compensation with a maximum of $69,000 for 2024. These changes provide an opportunity to increase your contributions to help you reach you retirement goals. Talk to you employer to adjust your contributions.

529 Rollover to Roth IRA

  • If you have unused 529 plan funds you can rollover a portion of those unused funds to a Roth IRA for the beneficiary of the 529 plan. There are some limitation though, the 529 plan must have been open for at least 15 years and the funds being rolled over must have been in the plan for at least 5 years. There is an annual limit of $6,000 per beneficiary and a lifetime benefit of $35,000 per beneficiary.

Social Security Increases

  • The cost-of-living adjustment for social security benefits is 3.2% and will be applied automatically beginning January 2024.

Consult your financial and tax professionals to explore these opportunities further and we are always here to help. 

Information is for general use only and not intended as investment, tax or legal advice.  Consult the appropriate professionals for information regarding your specific situation prior to making financial decisions.

 

Email questions to laura.skinner@lpl.com or call 620-325-3491.