457(b) Deferred compensation plan Contribution Limits
The maximum annual contribution limit for 457(b) plans is $24,500 for 2026 (or 100% of gross annual compensation, if less). Your contributions can be either pre-tax or after-tax Roth, which do NOT change the amount that you can contribute. Learn more about after-tax Roth below and at the Roth and SECURE 2.0 Act FAQ (coming soon).
| Year | Annual 457(b) Contribution Limits |
|---|---|
| 2026 | $24,500 |
| 2025 | $23,500 |
Cost of living adjustments may allow for additional increases to these limits in increments of $500 per year.
Catch-up Contributions
- A special catch-up limit allows participants who are age 50 and over to contribute an additional amount each year, and those contributions can be either pre-tax or after-tax Roth. Learn more about Roth at the Roth and SECURE 2.0 Act FAQ.
- For those turning ages 60-63 during the calendar year, the SECURE 2.0 Act provisions allow you to contribute a higher amount ($11,250 in 2026 instead of the standard $8,000 catch-up amount).
- For those who earned above a certain amount last year at MSU (above $150,000 based on your MSU 2025 W-2 Box 3 Social Security wage), the SECURE 2.0 Act provisions require your catch-up contributions to be after-tax Roth. Learn more about after-tax Roth at the Roth and SECURE 2.0 Act FAQ.
| Year | Annual 457(b) Contribution Limits | Additional Catch Up Limit | Total 457(b) Contribution Limit |
|---|---|---|---|
| 2026 | $24,500 | $8,000 | $32,500 |
| 2025 | $23,500 | $7,500 | $31,000 |
Cost of living adjustments may allow for additional increases to these limits in increments of $500 per year. For those turning ages 60-63 in 2026, the catch-up limit is $11,250 instead of the standard $8,000.
If you are within three years of attaining the normal retirement age of 65, another catch-up limit allows you to contribute up to twice the "annual contribution limit." The maximum amount allowed is actually the lesser of:
- twice the annual limit, or
- the annual limit, plus the total amount of underutilized contributions from prior years.
Participants who use this catch-up limit cannot also use the "age 50" catch-up limit in the same year.
EXAMPLE
Let's assume it is 2026, Jane is 62 years old, and she is within three years of her normal retirement age of 65 (per the 457(b) Plan Document). Let's also assume that she contributed $6,000 in 2023, $7,000 in 2024, and $8,000 in 2025, for a total of $21,000. However, she could have contributed $69,000 in those three years ($22,500 + $23,000 + $23,500) for an extra $48,000. Because Jane is within three years of her normal retirement age, she can contribute the lesser of:
- $49,000 (twice the annual 2026 limit of $24,500); or
- $72,500 (the 2026 limit of $24,500, plus the $48,000 "left over" amount from the three previous years).
In this example, Jane would be allowed to contribute $49,000 in 2026.
