How Much Can I Contribute to My 403b?

A 403(b) plan is a retirement savings vehicle available to employees of public schools, certain non-profit organizations, and ministers. These plans offer a tax-advantaged way to accumulate funds for retirement. The amount an individual can contribute each year is governed by a series of specific limits established by the Internal Revenue Service (IRS).

The regulations are designed to accommodate different career stages and circumstances, with varying limits that depend on factors like age and length of service. Navigating these figures ensures you remain in compliance with federal tax law. This framework of limits is subject to annual review and potential adjustments by the IRS to account for inflation.

Your Annual Elective Deferral Limit

The foundation of your 403(b) savings is the annual elective deferral limit. This figure represents the maximum amount of money you can contribute from your own salary into your account during a calendar year. For 2025, the IRS has set this general limit at $23,500, which applies to the total of your pre-tax and any designated Roth contributions.

An elective deferral is a contribution you choose to make from your paycheck. If you make pre-tax contributions, this action reduces your current taxable income. Roth 403(b) contributions, if your plan allows them, are made with after-tax dollars but allow for tax-free withdrawals in retirement.

The $23,500 limit is a personal, aggregate limit that applies to the combined contributions you make to all 403(b) and similar plans, such as a 401(k). Exceeding this total across all your plans can result in tax penalties.

The Age 50 Catch-Up Contribution

For individuals nearing retirement, an opportunity exists to accelerate their savings. Savers who are age 50 or older are eligible to make additional contributions above the standard elective deferral limit, known as the age 50 catch-up contribution. For 2025, this additional amount is $7,500, allowing an eligible individual to contribute a total of $31,000 for the year ($23,500 standard limit + $7,500 catch-up).

To be eligible, you must reach age 50 by the last day of the calendar year. This eligibility requirement does not depend on your years of service. You must check with your employer’s plan administrator to confirm that the 403(b) plan permits these additional contributions.

A new rule effective in 2025 from the SECURE 2.0 Act introduces a higher catch-up amount for a specific age group. If your plan adopts this provision, participants aged 60, 61, 62, and 63 can contribute an even greater catch-up amount of $11,250. This would bring their total potential employee contribution for 2025 to $34,750, while others remain subject to the standard $7,500 catch-up.

Special Catch-Up for Long-Service Employees

Beyond the standard age-based catch-up, 403(b) plans offer a unique provision for long-tenured employees, often called the 15-year rule. It is available to employees who have completed at least 15 years of service with their current employer, provided the employer is a qualifying organization such as a public school system or hospital. This catch-up allows for an additional contribution of up to $3,000 per year.

The maximum additional contribution you can make under this rule is the lesser of three amounts. The first is $3,000. The second is a lifetime limit of $15,000, reduced by any amounts you have previously contributed under this rule. The third is a formula: $5,000 multiplied by your years of service, from which you subtract the total of all elective deferrals you have made to the plan in previous years.

An employee who is eligible for both the age 50 catch-up and this 15-year service catch-up may be able to use both in the same year. Any contributions made above the standard elective deferral limit must first be applied toward the 15-year service catch-up limit. Only after that limit is exhausted can any remaining excess contributions be applied toward the age 50 catch-up limit.

The Overall Contribution Limit

A final, overarching limit governs the total amount of money that can be added to your 403(b) account in a single year from all sources. This is known as the annual additions limit, named after Internal Revenue Code Section 415. For 2025, this limit is the lesser of $70,000 or 100% of your includible compensation for your most recent year of service.

This limit includes your own elective deferrals, any catch-up contributions, and any contributions made by your employer. Employer contributions can take the form of matching contributions or non-elective contributions. The sum of all these sources cannot exceed the annual additions limit.

For example, if you are under 50 and contribute the maximum $23,500 to your 403(b) in 2025, your employer could contribute up to an additional $46,500 to your account. If you are a high-income earner or have a particularly generous employer matching program, you should be aware of this ceiling to ensure all contributions are within legal boundaries.