Q: Erick, can you provide clarification on the SECURE Act 2.0 mandatory Roth catch-up provision for high earners?
A: In 2026, mandatory Roth catch-up contributions for high-earning employees age 50 or older will become effective. Specifically, if an individual’s FICA wages from the same employer sponsoring the plan exceeded $145,000 in the prior calendar year (indexed annually), then any “catch‑up” contributions they elect must be made on an after‑tax Roth basis for 401(k), 403(b) or governmental 457(b) plans. If a plan does not have an existing Roth provision, they are not required to add it, but they will not be able to allow those employees to use the existing catch-up contribution provision in the plan.
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Disclosures, Sources, and Footnotes
For plan sponsor use only, not for use with participants or the general public. This information is not intended as authoritative guidance or tax or legal advice. You should consult with your attorney or tax advisor for guidance on your specific situation.
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©2024 Kmotion, Inc. This newsletter is a publication of Kmotion, Inc., whose role is solely that of publisher. The articles and opinions in this publication are for general information only and are not intended to provide tax or legal advice or recommendations for any particular situation or type of retirement plan. Nothing in this publication should be construed as legal or tax guidance; nor as the sole authority on any regulation, law or ruling as it applies to a specific plan or situation. Plan sponsors should consult the plan’s legal counsel or tax advisor for advice regarding plan-specific issues.
RP-276-0825 Tracking #781124 (Exp. 08/27)
