Can an employee max 457 and 408(p) plans in 2025?

Yes, generally an employee may contribute up to the full annual elective-deferral limit to both a 457(e)(15) deferred compensation plan and a separate 408(p) SIMPLE IRA plan in 2025, subject to the specific plan rules and any applicable compensation limits.[1][2]

Bottom Line

For 2025, the IRS states that:

• The elective deferral limit for 457 plans is $23,500.[1][2]
• The elective deferral limit for SIMPLE IRA plans under 408(p)(2)(E)(i)(III) is $16,500 in 2025.[1][4]
• SIMPLE IRA salary-reduction contributions are generally limited to 100% of compensation or $16,500 for 2025, unless a higher SECURE 2.0 limit applies for certain employers.[4]

So, an employee can generally max out both in the same year because the 457 deferral limit is separate from the SIMPLE IRA limit.[1][2]

Important Caveat

The main issue is not a combined statutory cap between the two plans, but whether the employee is actually eligible to contribute to both and whether the employee’s compensation supports both deferrals. A SIMPLE IRA is subject to its own plan-level rules, and if the employee also participates in another qualified plan, the SIMPLE contributions still count toward the employee’s overall annual elective-deferral limit for the other plan only as required by the plan rules described by the IRS.[4]

The IRS explains that the basic elective deferral limit for 2025 is $23,500, and the SIMPLE plan limit is separately $16,500 for 2025.[2][3][4]

Practical Answer

Thus, if the employee is eligible under both plans and has sufficient compensation, the employee can generally contribute $23,500 to the 457 plan plus $16,500 to the SIMPLE IRA in 2025.[1][2][4]