SIMPLE IRA catch-up contributions 2026: Who can save up to $5,250 extra?

Employees participating in a SIMPLE IRA can contribute up to $17000 from their salaries in 2026. Eligible older workers may qualify for additional catch up contributions while employers must follow separate rules for matching contributions or making payments on behalf of eligible employees.

The contribution limits depend on an employee’s age and the type of contribution. The Internal Revenue Service has outlined the applicable limits and employer requirements for SIMPLE IRA plans.

SIMPLE IRA Contribution Limit for 2026

The salary reduction contribution limit for a SIMPLE IRA is $17000 this year. These are contributions employees make from their salaries.


Employees who also participate in another employer-sponsored retirement plan during the year may be subject to a combined limit. Their total salary reduction contributions across the plans cannot exceed $24,500 in 2026, subject to applicable rules.

SIMPLE IRA contributions can include employee salary reduction contributions and employer contributions. Employer contributions may take the form of matching contributions or nonelective contributions. No other types of contributions can be made to a SIMPLE IRA plan.

SIMPLE IRA Catch-Up Contribution Limits This Year

Eligible employees who are 50 years or older by the end of the calendar year can make additional catch-up contributions if their SIMPLE IRA plan permits.

The catch-up contribution limit is $4000 this year. A higher limit applies to employees aged 60, 61, 62 or 63 who participate in SIMPLE plans. These employees can make catch-up contributions of up to $5250 in 2026.

Employer Matching Contributions Under SIMPLE IRA Rules

Employers generally must match employees’ salary reduction contributions dollar for dollar, up to 3% of their compensation.

An employer may choose a lower matching contribution rate, but it must be at least 1%. This lower rate can apply for no more than two years in a five-year period, subject to the applicable notification requirements.

Instead of matching contributions, an employer can choose to make nonelective contributions for eligible employees.

SIMPLE IRA Nonelective Contributions: The 2% Rule

Under the nonelective contribution option, an employer contributes an amount equal to 2% of each eligible employee’s compensation, regardless of whether the employee makes salary reduction contributions.

For 2026, compensation of up to $360,000 is considered when calculating the 2% nonelective contribution.

Employers must follow the applicable notification requirements when choosing this contribution method.

SIMPLE IRA Contribution Deadlines for 2026

Employers must deposit employees’ salary reduction contributions into their SIMPLE IRAs within 30 days after the end of the month in which the employees would otherwise have received the money in cash.

Matching and nonelective contributions generally must be deposited by the due date of the employer’s federal income tax return for the year, including extensions.

Additional timing requirements may apply to plans covered by Department of Labor rules. The IRS also identifies a seven-day safe harbor for depositing elective deferrals that applies to most SIMPLE IRA plans.