2026 SIMPLE catch-up limits

[Ian]

Because of differing ways of calculating COLAs, it looks like the 2026 SIMPLE IRA catch-up limit for plans with 25 or fewer employees (or bigger plans where the employer has elected the 1% extra employier contribution) is $3,850, while the catch-up limit where a bigger employer has not elected the extra 1% is $4,000. This is exactly the reverse of what Congress was trying to accomplish.

Am I interpreting that correctly? Thank you!

 

[austin3515]

I think the IRS got this one right. You might enjoy the whole thread...

 

[Bruce1]

I was reading through the IRS Cost-Of-living changes and thought the exact same thing! 

[Peter Gulia]

“This is exactly the reverse of what Congress was trying to accomplish.”

But how do we know that what Congress sought to accomplish is something different than what the enacted text provides?

Among many challenges in interpreting recent years’ tax legislation is that there often is no committee report that describes the text Congress enacted.