PKF O'Connor Davies Accountants and Advisors
PKF O'Connor Davies Accountants and Advisors
Insights

2025 Cost-of-Living Adjustments

By Louis F. LiBrandi, Partner

Plan sponsors should review the cost-of-living adjustments (COLAs) to determine what, if any, changes need to be communicated to employees by means of orientation meetings and enrollment forms. In addition, the amounts may need to be updated and/or input into the payroll or other human resources information systems used by the employer to monitor contributions made to an employee benefit plan.

The table below contains the dollar limitation for retirement plans and other benefit plan limits and thresholds for 2025 and the dollar limitation for 2022 through 2024 tax years.  Many of the amounts for 2025 have been increased.

Cost of Living Adjustments

Retirement Plans

2025

2024

2023

2022

402(g) Elective Deferrals.
Maximum salary-reduction contribution; 401(k), 403(b) and 457(b) plans.

$23,500

$23,000

$22,500

$20,500

Catch-up Contributions.
Age 50 or older additional salary reduction contributions; 401(k), 403(b), government 457(b) plans.

$7,500

 

$7,500

$7,500

$6,500

Catch-up Contributions.
Age 60, 61, 62 and 63 additional salary reduction contributions; 401(k), 403(b), government 457(b) plans.

$11,250

401(a)(17) Compensation Limit. Ceiling for using compensation to determine benefits in a qualified retirement plan.

$350,000

$345,000

$330,000

$305,000

415(c)(1)(A) Maximum dollar amount for a defined contribution plan (excludes catch-up).

$70,000

$69,000

$66,000

$61,000

Highly Compensated Employee (HCE).
Compensation earned in a prior year is used to determine if a participant is an HCE.

$160,000

$155,000

$150,000

$135,000

Key Employee. Minimum compensation for an officer to be treated as a ‘’key employee.

$230,000

$220,000

$215,000

$200,000

Social Security Wage Base

2025

2024

2023

2022

Social Security Taxable Wage Base.

$176,100

$168,600

$160,200

$147,000

Welfare Plans

2025

2024

2023

2022

Health FSA Contribution Limit.

$3,300

$3,200

$3,050

$2,750

HSA Contribution Limit – Single.

$4,300

$4,150

$3,850

$3,650

HSA Contribution Limit – Family.

$8,550

$8,300

$7,750

$7,300

Catch-up Contributions.
Age 55 or older.

$1,000

$1,000

$1,000

$1,000

Contact Us

The Employee Benefit Services Group at PKF O’Connor Davies is available to assist employers with all aspects of employee benefit plan compliance. For more information, please contact your client service team or either of the following:

Timothy J. Desmond, CPA
Partner-in-Charge
Employee Benefit Services
tdesmond@pkfod.com | 551.249.1728

Louis F. LiBrandi, EA, CEBS, ChFC, TGPC
Partner
Employee Benefit Services Group
llibrandi@pkfod.com | 646.449.6327