The IRS recently announced various adjustments to retirement plan and annual gifting limitations for 2026. Here are some key highlights to note:

New Changes to Required Minimum Distribution Guidelines

If you were born in 1953, 2026 marks the first year you will need to take required minimum distributions (RMD) from your traditional retirement accounts. The government views your IRAs as IOUs and now they are ready to collect.

In some cases, it may make sense to delay taking action until April 2027, but then you would have to take two distributions in the same year. This course of action only makes sense if you expect your income to drop in 2027 compared to 2026.

In many cases, the most tax-efficient way to give to charity is by using your RMD. Your RMDs are generally considered taxable income, but when you donate your RMD to charity, the income is not taxable. The charity gets funding, you fulfill your requirement, and you don’t have to pay taxes on your RMD – everybody wins (except for the government)!

Still Working For a Living? Now You Can Contribute More to Your Retirement

For all of you under the age of 50 and still working, the amount you will be able to contribute to our retirement plans (401(k)/403(b)/TSP) will increase slightly from $23,500 to $24,500. Assuming you fall below the income limits, the amount you can contribute to IRAs will increase from $7,000 to $7,500.

Turning 50 This Year? Time to Play “Catch-Up” on Retirement Savings Contributions

If you were born in 1976, congratulations in advance on reaching the age of 50 this year! You can now make “catch-up” contributions to your retirement plans for the first time.

The total amount you will be able to contribute to your 401(k)/403(b)/TSP in 2026 will be $32,500, with the catch-up amount set at $8,000 and the regular annual amount set at $24,500. It doesn’t matter where your birthday falls during the year, although ideally, you would update your retirement contributions to reflect this higher amount beginning January 1, 2026.

There are also catch-up contributions for IRA contributions. Assuming your income falls below the stated limits, the amount you can contribute to an IRA will increase from $8,000 to $8,600.

Turning 60 This Year? Now’s Also the Time to Play “Catch-Up” on Retirement Savings Contributions

If you are between the ages of 60 and 63, you are now eligible to make a larger catch-up contribution of up to $11,250 in 2026. If you were born between 1963 and 1966, the total amount you will be able to contribute to your 401(k)/403(b)/TSP in 2025 will now be $35,750.

Make a Resolution to Gift More This Year

According to the IRS’ announcement, the annual gift exclusion limit – which is the set amount of money you can gift to any person without having to file a gift tax return – will remain the same at $19,000. Consider gifting appreciated securities to charities or family members in a lower tax bracket, as neither group of recipients will need to pay capital gains taxes.

The details are listed in the table below.

Don’t hesitate to contact your advisor with any questions!