What is the maximum contribution limit for a Keogh plan?

The maximum contribution limit for a Keogh plan relates closely to the limits established for other qualified retirement plans, particularly defined contribution plans. Keogh plans, also known as HR10 plans, are designed for self-employed individuals and small businesses, allowing them to contribute a substantial portion of their earnings towards retirement.

In 2023, the maximum contribution limit for a defined contribution Keogh plan is the lesser of 25% of the participant's compensation or a specified annual limit, which is set at $66,000. These limits are aligned with those applicable to 401(k) plans and other defined contribution plans, reflecting the overarching regulatory framework guiding retirement savings options.

Therefore, asserting that the maximum contributions to a Keogh plan are the same as those in other qualified plans is accurate, as it underscores the structured contribution limits designed to encourage retirement savings across various employment types and structures. This makes contribution strategies in Keogh plans comparable to those in other qualified plans, providing flexibility while adhering to regulatory standards.