Contributions to 403(b) accounts are limited to the least of:

If the only contributions were elective deferrals made under a salary reduction agreement, the maximum amount that can be contributed is the lesser of the annual additions limit or the elective deferrals limit.

If only nonelective contributions were made, the annual additions limit applies. Nonelective contributions are employer contributions that are not made under a salary reduction agreement, and include matching contributions, discretionary contributions, and mandatory contributions from the employer.

If contributions included a combination of elective deferrals and employer’s nonelective contributions, the maximum that can be contributed is the limit on annual additions.

The elective deferral limits are the same as for other defined contribution plans, such as the 401(k), including allowing individuals aged 50 and over to make additional contributions.

SECURE 2.0 Act Section 109 increases the catch-up contribution limits to the greater of $10,000 or 50 percent more than the regular catch-up amount beginning in 2025 for individuals who have attained ages 60, 61, 62 and 63. The increased amounts are indexed for inflation after 2025.

Thus, beginning in 2025 403(b) plan catch-up amount for individuals aged 60 though 63 will be the greater of $10,000 or 50% more than the regular inflation adjusted catch-up amount.

For employees with at least 15 years of service with specific eligible employers (such as schools, hospitals and churches), additional contributions are possible within certain limits, potentially allowing the least of $3,000, $15,000 less previously excluded special catchups, or $5,000 multiplied by years of service minus previously excluded deferrals

SECURE 2.0 Act Section 603 (amending IRC Sec 414) provides that effective January 1, 2026*, all catch-up contributions, if the participant’s Social Security wages for the prior year exceeded $145,000, must be designated Roth contributions. In addition, if catch-up contributions are provided under a plan as designated Roth contributions for participants whose wages exceed $145,000, the plan must also permit catch-up contributions made by other eligible participants to be designated Roth contributions. 

*These changes were originally scheduled to take effect January 1, 2024, but to help taxpayers make a smooth transition, the IRS extended the effective date to January 1, 2026 by (IR 2023-62 and IR-2023-155 released August 25, 2023.

Worksheets are available in IRS Pub 571 to assist in determining the contribution limits.

In addition to the limit on elective deferrals, annual contributions to all an employee’s retirement accounts – including elective deferrals, employee contributions, employer matching and discretionary contributions and allocations of forfeitures to the accounts - may not exceed the lesser of 100% of the employee’s compensation or for 2025 $70,000. Also, the amount of compensation for 2025 that can be considered when determining employer and employee contributions is limited to $350,000.

The limit does not just apply to each 403(b) plan to which the employee makes elective deferrals, but instead applies to the aggregate amount of all the elective deferrals made by the employee for the year to all plans which permit such contributions, including:

However, Code Sec. 457 plans (government plans) are not included in the overall deferral limitations