Most of 2025 is now behind us, and 2026 is quickly approaching. A new year often brings excitement and optimism about what’s to come. However, a new year can also bring uncertainty for many, as they wrestle with changes out of their control. Fortunately, in the financial realm, the IRS released a list of key financial numbers, so we have some concrete numbers and answers as we head into 2026. We’ve provided a non-exhaustive overview of those numbers below. Numbers are up to date as of December 19th, 2025.
For Those Retired:
- Required Minimum Distributions (RMD): If you have an IRA account, your RMD resets in 2026. For those who are turning 73 during the 2026 calendar year AND have an IRA account, congratulations, the government is now requiring you to take funds out of your IRA account.
- Paradigm will manage and ensure you satisfy your RMD requirement in 2026
- Qualified Charitable Distributions (QCD): For those over 70 ½, you can make qualified charitable donations directly from your IRA account.
- The IRS increased the amount you can gift from your own IRA account to $111,000. If you and your spouse are both over 70 ½, this means you could gift $222,000 directly out of your IRA accounts!
- Social Security Cost of Living Adjustment (COLA): For those receiving Social Security, you’ll receive a 2.8% raise in 2026! That figure is slightly higher than 2.5% you received in 2025.
For Your Estate:
- Federal Estate Tax Exemption: Starting next year, up to $15 million ($30 million for married couples) of your net worth is exempt from Federal estate taxes.
- State Estate Tax Exemption: Most states did not change their estate tax exemptions for 2026, although several states have their exemption limits tied to an inflation adjustment or the Federal exemption.
- Many states have no estate tax exemption.
- Gifting to Family & Friends: Many individuals gift money to their family & friends each year. For 2026, the gift tax exemption remains at $19,000 per individual.
- For married couples, this means you could give $38,000 total to an individual ($19,000 each) in 2026.
For Those Saving:
- 401(k), 403(b), & 457 Plan Employee Contribution Limits: For 2026, you can now contribute $24,500 to these accounts.
- For those over age 50: You can contribute an additional $8,000 catch- up contribution in 2026.
- For those ages 61, 62, or 63: You can contribute a higher catch-up contribution of $11,250 instead of $8,000 in 2026.
- An important change if you earn over $150,000: If you are over age 50 and your W2 FICA wages are over $150,000, you are required to make your catch-up contribution on a post-tax Roth 401(k) basis.
- SIMPLE Contribution Limits: If you participate in a SIMPLE account, you can contribute up to $17,000 in 2026.
- For those over age 50: You can contribute an additional $4,000 catch- up contribution in 2026.
- For those ages 61, 62, or 63: You can contribute a higher catch-up contribution of $5,250 in 2026.
- Roth IRA & Traditional IRA Contribution Limits: For 2026, the maximum contribution amount increased to $7,500.
- Spread evenly among the calendar year, a maximum contribution equates to $625/month.
- Roth IRA Income Limits: Overall, the Modified Adjusted Gross Income (MAGI) limits associated with Roth IRA’s increased. However, the specific amount depends on your marital and tax filing status.
- Filing Taxes Single or Head of Household: The new MAGI range is from $153,000 to $168,000 (increased from $150,000 to $165,000). If you fall within that range, your maximum allowable Roth contribution is prorated.
- Filing Taxes Married Jointly: The new MAGI phase-out range is from $242,000 to $252,000 (previously $236,000 to $246,000). If you fall within that range, your maximum allowable Roth contribution is prorated.
- Filing Taxes Married Separately: The MAGI phase-out range did not change, and remains between $0 to $10,000, essentially eliminating the possibility of contributing to a Roth IRA if you complete your taxes Married Filing Separately.
As you prepare for the year ahead, this key financial data can help provide a valuable roadmap for making informed decisions about your finances. At Paradigm, we make it our responsibility to stay aware of the latest IRS changes and contribution limits, to help you better position yourself and your loved ones for financial security in 2026 and beyond. If you have questions about how these updates may impact your personal situation, please do not hesitate to reach out to the Paradigm Team.
Sources:
https://www.irs.gov/newsroom/401k-limit-increases-to-24500-for-2026-ira-limit-increases-to-7500
https://www.congress.gov/bill/119th-congress/house-bill/1/text