2026 COLA Projection of Dollar Limits

The CPI-U for July 2025 was published with a value of 323.048. If inflation is 0% in August and September, based on Tom Poje's spreadsheet, some of the dollar limits for 2026 are projected to be:

NOT Official yet, of course:

Deferral limit: $24,500 (up from $23,500)

Catchup: $8,000 (up from $7,500)

Compensation Limit: $360,000 (up from $350,000)

Annual Addition Limit: $72,000 (up from $70,000)

DB Limit: $290,000 (up from $280,000)

HCE: $160,000 (unchanged)

Key Employee: $235,000 (up from $230,000)

John-

I still am somewhat in awe my spreadsheet still gets a lot of use, quite honored in fact. At least I was able to teach a few useful things!

feeling really old now, seeing the deferral limit + catch up is more than back in the day when we waited forever for the annual addition limit to get above 30,000!

Haven't looked at that spreadsheet for years, but that was in 2000. nice historical data for anyone who cares!

Now for some reason I only update a sheet for Soc Sec! (which uses cpi-W) 

God bless all of you out there.

Hey, until the rules change, a Y2K spreadsheet is just as good as anything! 

(I still x-test PS plans from something I built in my 20s, a decade I no longer am in.)

Any estimate on the Highly Paid Employees that will have to Roth Catch-up Required Employees?  Current level is $145K

To adjust the § 414(v)(7)(A) amount, its base period is “the calendar quarter beginning July 1, 2023[.]”

https://benefitslink.com/boards/topic/80061-is-150000-the-limit-on-2025-fica-wages-before-a-participant-must-make-2026-age-based-catch-up-elective-deferrals-as-roth-contributions/

In July, I estimated that, for 2025 FICA wages to drive how § 414(v)(7) applies for 2026, the $145,000 will become $150,000.

John Feldt, how’s my logic and my math?

@John Feldt ERPA CPC QPA  Can you do this the other way?  Since your list shows only one item that does NOT increase, what is the minimum inflation of August/September that will cause that limit to increase?

On 8/12/2025 at 9:08 AM, John Feldt ERPA CPC QPA said:

The CPI-U for July 2025 was published with a value of 323.048. If inflation is 0% in August and September, based on Tom Poje's spreadsheet, some of the dollar limits for 2026 are projected to be:

NOT Official yet, of course:

Deferral limit: $24,500 (up from $23,500)

Catchup: $8,000 (up from $7,500)

Compensation Limit: $360,000 (up from $350,000)

Annual Addition Limit: $72,000 (up from $70,000)

DB Limit: $290,000 (up from $280,000)

HCE: $160,000 (unchanged)

Key Employee: $235,000 (up from $230,000)

Any update on this, given that we're now into October?  

The Bureau of Labor Statistics slightly varied Labor’s shutdown plan to allow work on the Consumer Price Index measure as needed to set increases in Social Security payments. Today BLS announced September’s CPI measure. https://www.bls.gov/

But the IRS people who apply CPI measures to form the adjustments the Internal Revenue Code calls for won’t be available to work on this until after the government shutdown ends.

Now that September’s CPI measure is announced, unofficial estimates might complete the arithmetic.

Some of us observed in July some adjustments that would be within rounding bands, even if August’s and September’s inflation would be much higher than expected.

Over the past dozen weeks, I’ve advised some clients to prepare for Thanksgiving arriving with the IRS not having released inflation-adjusted amounts.

@Peter Gulia, oh, I know we won't have the official figures for a while.  But in past years, people have been able to use @Tom Poje's spreadsheet to project the limits once the BLS came up with its numbers.  @John Feldt ERPA CPC QPA, are you yet able to do that?

Yes, users of Tom Poje’s spreadsheet or another method now have the September Consumer Price Index measure.

And here’s a BenefitsLink discussion that anticipated the government shutdown: https://benefitslink.com/boards/topic/80346-how-would-lacking-official-inflation-adjusted-amounts-affect-your-work/.

Sorry for the delay - so many meetings!

The CPI-U for July, August, September of 2025 are all published with values of 323.048, 323.976, and 324.800 respectively. Based on Tom Poje's spreadsheet, the dollar limits for 2026 will be:

NOT Official via any IRS pronouncement yet, of course:

Deferral limit: $24,500 (up from $23,500)

Catchup: $8,000 (up from $7,500) (Super-Catchup, age 60-63 = $11,250, (unchanged)

Compensation Limit: $360,000 (up from $350,000)

Annual Addition Limit: $72,000 (up from $70,000)

DB Limit: $290,000 (up from $280,000)

HCE: $160,000 (unchanged)

Key Employee: $235,000 (up from $230,000)

If you are numbers nerd, the unrounded values are:

Deferrals: $24,683

Catchup: $8,227.50

Compensation Limit: $364,460

Annual Addition Limit: $72,892

DB Limit: $291,568

HCE: $164,680

Key Employee: $236,899

Thank you, @John Feldt ERPA CPC QPA!

47 minutes ago, John Feldt ERPA CPC QPA said:

If you are numbers nerd, the unrounded values are:

 

Number nerds hanging around here?  I doubt that.  

I am going to guess regarding the $145,000 HPI limit. This was stated to be adjusted the same way as the others, but using 7/1/2023 - 9/30/2023 as the base period for years beginning after 12/31/2024 with increases occurring in $5,000 increments. Thus, $145,000 was the limit for 2024 when the law required mandatory Roth Catchups to begin (and in an unusual move by the IRS, we were allowed to ignore the law in 2024 and 2025), and the COLA for the 2025 HPI limit would have been increased this as follows:

$145,000 x (314.540 + 314.796 + 315.301) / (305.691 + 307.026 + 307.789) = $148,799, which is not $5,000 more, so no increase for 2025, stayed at $145,000

But, for 2026:
$145,000 x (323.048 + 323.976+ 324.800) / (305.691 + 307.026 + 307.789) = $153,077, which is at least $5,000, so the 2026 HPI comp number should be $150,000

It's unclear to me based on the law/regs, but my guess is that means in 2027 we look at comp over $150,000 paid in 2026 for determining HPI's in 2027.

The taxable wage base for 2026, announced by SSA, is $184,500 (it's $176,100 in 2025).

https://www.ssa.gov/oact/cola/cbb.html