This is an update to the Milliman 2027 IRS Limits Forecast using the U.S. Bureau of Labor Statistics (BLS) report published May 12, 2026.
Our initial forecast for March 2026 can be found here. It includes information about the limits for qualified retirement plans, how these limits are calculated, and why they may be relevant for certain plan sponsors.
April 2026 forecast
Our limits forecast is projected using two assumption sets. One set is based on the current trailing 12 months of the Consumer Price Index (CPI) and the second assumes that year-to-date CPI (since September 30, 2025) will continue to increase each month through September 30, 2026, by an estimated 25 basis points (3.0% annual).
Historical rolling 12-month changes in the CPI as of each September 30 through 2025, and the current trailing 12-month change through April 30 of the current federal fiscal year (FFY), are shown in Figure 1.
Figure 1: Historical 12-month percentage change each September 30 and current trailing 12-month percentage change through April 30, Consumer Price Index, all items, not seasonally adjusted
Source: U.S. Bureau of Labor Statistics.
The CPI as reported by the BLS for the 12 months ended April 30, 2026, was 3.8%, up from 3.3% for the 12 months ended March 31, 2026, and higher than the 3.0% annual change in the CPI as of September 30, 2025 (i.e., the close of the prior FFY). It is also higher than the 3.2% average annual change over the past 10 years ended September 30, 2025, and higher than the 2.5% average annual change over the past 20 years ended September 30, 2025.
Since September 30, 2025, the CPI has increased by about 2.5%. Projecting monthly increases of 0.25% through September 2026 results in an annual increase of about 3.8% for our 7-month actual/5-month forecast projection.
Figure 2 shows the limits forecasts under both assumption sets. Values that changed from the March forecast are in bold.
The BLS is expected to release the May CPI results on June 10, 2026. We will update this forecast at that time.
Please contact your Milliman consultant for details and questions about how these limits apply to your retirement plan(s).
Figure 2: 2027 IRS Limits Forecast using actual FFY 2026 Consumer Price Index (CPI) as of April 30, 2026
| Category of annual IRS limits | 2026 IRS limits | Estimated 2027 IRS limits | Dollar increases from 2026 limit | ||
|---|---|---|---|---|---|
| Actual 12-month trailing Consumer Price Index (CPI) as of 4/30/2026 | 7-month actual 4/30/2026, 5 months forecast to 9/30/2026 | Actual 12-month trailing Consumer Price Index (CPI) as of 4/30/2026 | 7-month actual 4/30/2026, 5 months forecast to 9/30/2026 | ||
| Maximum annual annuity pension for DB plans | $290,000 | $300,000 | $300,000 | $10,000 | $10,000 |
| Maximum annual addition for DC plans | $72,000 | $75,000 | $75,000 | $3,000 | $3,000 |
| Maximum §401(k), §403(b), §457 deferral for DC plans | $24,500 | $25,500 | $25,500 | $1,000 | $1,000 |
| Catch-up contribution limit for DC plans | $8,000 Ages 60 to 63: $11,250 |
$8,500 Ages 60 to 63: $11,750 |
$8,500 Ages 60 to 63: $11,750 |
$500 $500 |
$500 $500 |
| Compensation limit | $360,000 | $375,000 | $375,000 | $15,000 | $15,000 |
| HCE dollar amount | $160,000 | $170,000 | $170,000 | $10,000 | $10,000 |
| Key employee/officer compensation | $235,000 | $245,000 | $245,000 | $10,000 | $10,000 |
| Contribution limit to ESAs for DC plans | $2,600 | $2,700 | $2,700 | $100 | $100 |
| Prior-year wage threshold triggering Roth catch-up contributions to DC plans | $150,000 | $155,000 | $155,000 | $5,000 | $5,000 |
| Domestic abuse withdrawal limit | $10,500 | $10,900 | $10,900 | $400 | $400 |
Source: https://www.bls.gov/cpi/ retrieved May 12, 2026.
Actual 12-month trailing Consumer Price Index (CPI) for All Urban Consumers (CPI-U) of 3.8% ending April 30, 2026.
Actual 7-month Consumer Price Index (CPI)-U ending April 30, 2026, and 0.25% per month for May through September 2026.