Employees will be able to contribute up to $19,500—an extra $500—in their $401(k) and other retirement plans next year due to cost-of-living adjustments, according to an IRS press release.

The new contribution limit also applies to employees who participate in 403(b) plans, most 457 plans and the federal government's Thrift Savings Plan. The limit on catch-up contributions for employees aged 50 and over who participate in these plans will be increased from $6,000 to $6,500, the IRS said.

Also, the limitation regarding Savings Incentive Match Plan For Employees Of Small Employers, or SIMPLE retirement accounts, will be increased to $13,500, up from $13,000 for 2019.

The agency also increased the income ranges for determining eligibility to make deductible contributions to traditional and Roth IRAs and for claiming the Saver's Credit.

In addition, the income limit for the Saver's Credit (also known as the Retirement Savings Contributions Credit) for low- and moderate-income workers will be $65,000 for married couples filing jointly, up from $64,000; $48,750 for heads of household, up from $48,000; and $32,500 for singles and married individuals filing separately, up from $32,000.

The limit on annual contributions to an IRA will remain unchanged at $6,000. The additional catch-up contribution limit for individuals aged 50 and over also remains at $1,000 because it is not subject to an annual cost-of-living adjustment, the IRS said.