Every dollar in a sheltered account is a dollar that never sees the 52% short-term rate or the yearly dividend tax. The slots are limited and they reset every January. Here are the 2026 limits. The 401(k) and IRA numbers are per person, so a working couple gets two of each; the family HSA limit covers the household.
| Slot | 2026 limit | Who can use it |
|---|---|---|
| 401(k) salary deferral | $24,500, plus $8,000 catch-up from age 50 | Anyone with a plan. Above $150,000 of prior-year wages the catch-up must go into the Roth side |
| Total 401(k) additions (employee plus employer plus after-tax) | $72,000 | Plans that allow after-tax contributions. The gap above the deferral is the “mega backdoor” |
| IRA | $7,500 | Anyone with earned income. Roth eligibility phases out at $242,000 to $252,000 of income for a joint filer |
| HSA, family coverage | $8,750 | Households on a high-deductible health plan |
The two back doors
High earners are above the Roth IRA income limit, so they use a two-step route: contribute $7,500 to a traditional IRA with no deduction, then convert it to a Roth. The 2025 tax act left this route in place.
The larger version runs through the 401(k). A plan that permits after-tax contributions lets an employee fill the space between the $24,500 deferral and the $72,000 total-additions ceiling with after-tax money, then convert it inside the plan to Roth. For someone whose employer contributes little, that can be $40,000 or more a year of Roth space. Not every plan allows it; the plan document decides.
The California trap
The HSA is the best-treated account in the federal code and California does not recognize any of it: the state taxes the contributions and the account’s dividends and gains every year. The federal saving still stands; the state return gets an extra entry. The details are in California taxes the HSA every year.
Order of operations
The shelters cost nothing to use, so the sequence for new money is short: the 401(k) deferral, then the HSA, then the two Roth routes, then whatever is left goes to the taxable account. What goes into each slot follows the turnover rule: high-turnover exposure into the traditional side, long-term equity exposure into the Roth or the taxable account.