401(k), SIMPLE IRA & IRA Contribution Basics
Elective deferrals, employer match formulas, SIMPLE IRA, IRS limits, and Roth IRA MAGI phase-outs in plain language.
Published
Workplace plans let you defer salary into a traditional or Roth 401(k). Many employers match a portion of what you put in — but only under a specific match formula. The same tool also models SIMPLE IRA (a smaller-employer workplace plan) and personal Traditional/Roth IRAs with their own lower limits.
Match formulas (401(k) mode)
Employers rarely match “everything you put in.” Two common patterns:
- Classic 3% + 2% (default in the calculator): 100% match on the first 3% of salary you defer, then 50% on the next 2%. If you earn $100,000 and defer 10%, the employer puts in 3% + 1% = $4,000 (max when you defer 5%+).
- Simple % of pay: 100% of your deferrals up to a single cap (for example 3% of salary — common on SIMPLE IRAs). Deferring more than the cap does not increase the match.
The 401(k) & IRA contribution calculator applies these formulas, caps employee deferrals at common IRS limits for the year, and can project simple growth of this year’s contributions.
Limits (traditional + Roth 401(k) share one bucket)
| 2025 | 2026 | |
|---|---|---|
| Employee elective deferral (under 50) | $23,500 | $24,500 |
| Catch-up (50+, standard) | $7,500 | $8,000 |
| Super catch-up (60–63, if plan allows) | $11,250 | $11,250 |
| Overall employee + employer (415(c)) | $70,000 | $72,000 |
Roth 401(k) deferrals count against the same elective limit as traditional 401(k).
SIMPLE IRA (separate workplace path)
SIMPLE IRA plans use lower employee limits and a different catch-up schedule. In the calculator, pick SIMPLE IRA under account type — match defaults to a flat 3% of pay style formula (you can still change the “match up to” percent). Super catch-up ages 60–63 can apply when the plan allows; confirm with plan docs.
| 2025 | 2026 | |
|---|---|---|
| Employee salary reduction (standard plans) | $16,500 | $17,000 |
| Catch-up (50+, standard) | $3,500 | $4,000 |
| Super catch-up (60–63, if plan allows) | $5,250 | $5,250 |
Some ≤25-employee plans may allow higher employee limits under IRS rules — this model uses the standard (not elevated) limits.
IRA mode and Roth MAGI phase-outs
Toggle to IRA for personal traditional or Roth IRA limits (for example $7,500 under 50 in 2026, plus catch-up if 50+). Contributions also cannot exceed taxable compensation. Personal IRAs do not use employer match or 60–63 super catch-up.
For Roth IRA, direct contributions also depend on modified AGI and filing status. The calculator applies IRS phase-out ranges for 2025 and 2026 (full contribution below the start of the range, reduced through the range, $0 at or above the end). Backdoor Roth is not modeled.
Confirm every figure against IRS COLA notices and your plan documents.
Try it
Enter salary and raise deferral until you capture the full match (about 5% under the classic 3% + 2% formula), then decide whether to go further toward the annual limit. Switch to SIMPLE IRA or IRA + Roth and enter MAGI to see how limits and phase-outs change.