The IRS announced Friday an increase in the amount individuals can contribute to their 401(k) plans in 2025 – to $23,500, up from $23,000 in 2024.

The Internal Revenue Service detailed increases to its annual cost-of-living adjustments for pension plans and other retirement accounts.

Workers participating in 403(b) and the federal government's Thrift Savings Plan can increase their annual contribution to $23,500 in 2025 from $23,000 in 2024.

Some annual contributions remain the same. The limit on annual contributions to an IRA remains at $7,000 and the IRA catch-up contribution limit for those age 50 or older remains at $1,000 for 2025.

The agency last week announced an increase in the standard deduction in its annual inflation adjustments for 2025. For single taxpayers and married individuals filing separate tax returns for the 2025 tax year, the standard deduction increases to $15,000 – an increase of $400 from 2024.

For couples filing jointly, this standard deduction for 2025 is $30,000, an increase of $800 from the previous year. And heads of household get a standard deduction of $22,500, $600 more than in 2024.

The income limits for all seven federal tax brackets have also been revised upwards.

Last month, the Social Security Administration announced a 2.5% cost of living increase for benefit recipients from January. That represents an average increase of more than $50 in millions of people's monthly checks, the smallest annual COLA increase since 2021. Although inflation has eased from its pandemic-era highs, some advocates for older Americans see the modest Surge in Social Security benefits puts U.S. retirees at risk of losing financial ground.