Federal SECURE 2.0 · Retirement Plans · 2026 📖 5 min read

SECURE 2.0 Mandatory Roth Catch-Up Contributions: 2026 Compliance Guide

Since January 1, 2026, employees 50 and older earning more than $150,000 must make retirement catch-up contributions as Roth, not pretax. Here's the wage threshold, plan mechanics, and the December 31, 2026 amendment deadline.

einTime Editorial Team

Payroll Compliance Analysts

Jul 29, 2026Published

5 min readRead time

FederalCategory

⚡Key Takeaways for Payroll Professionals

High earners age 50+ must now make catch-up contributions as Roth

Since January 1, 2026, employees age 50+ who earned more than $150,000 in FICA wages from their current employer in the prior year must make retirement plan catch-up contributions as Roth (after-tax), not pretax, under SECURE 2.0 Section 603.
The rule covers specific plan types

It applies to 401(k), 403(b), and governmental 457(b) plans; it does not apply to SIMPLE IRAs, SARSEPs, or certain other plan types.
Final Treasury regulations arrived after a two-year delay

T.D. 10033 was issued September 16, 2025, following a two-year administrative delay from the rule's original 2024 effective date.
2026 catch-up limits

The standard catch-up contribution limit is $8,000 for employees 50 and older, with a "super catch-up" of $11,250 available to employees ages 60–63.
Plans without a Roth option must be amended by year-end

Plans that don't currently offer a Roth contribution option cannot allow affected high earners to make any catch-up contributions at all unless amended to add a Roth feature — the deadline to formally amend plan documents is December 31, 2026.

What Changed and Why It Matters

SECURE 2.0 Section 603 requires that catch-up contributions made by higher-earning employees to 401(k), 403(b), and governmental 457(b) plans be designated as Roth (after-tax) contributions rather than traditional pretax contributions. The rule targets employees age 50 or older whose prior-year FICA wages from their current employer exceeded a wage threshold, currently set at $150,000.

Originally scheduled to take effect in 2024, the IRS granted a two-year administrative transition period (via Notice 2023-62), pushing the practical compliance date to January 1, 2026. Final regulations were published as Treasury Decision 10033 on September 16, 2025, and while the regulations are formally effective for the 2027 plan year, the IRS has indicated that plans operating in reasonable, good-faith compliance during 2026 will be treated as satisfying the requirement.

📋 2026 Retirement Plan Contribution Limits

IRS, Treasury Decision 10033

Contribution Type	2026 Limit	Roth Required?
Standard elective deferral	$24,500	No
Catch-up (age 50–59, 64+)	$8,000	Yes, if prior-year FICA wages > $150,000
"Super" catch-up (age 60–63)	$11,250	Yes, if prior-year FICA wages > $150,000

The $150,000 Wage Threshold

The wage threshold that triggers mandatory Roth catch-up treatment is based on an employee's prior-year FICA wages from their current employer — not household income, not total compensation from all sources, and not wages from a previous employer if the employee changed jobs. The IRS updated the threshold figure to $150,000 in final guidance issued November 13, 2025, revising an earlier proposed figure of $145,000.

ℹ️

New Employees Are Not Subject to the Rule in Their First Year

Because the threshold looks at prior-year FICA wages from the current employer, an employee who joins a new employer mid-career has no "prior year" wages with that employer and is therefore not subject to the mandatory Roth catch-up requirement for their first year of employment, regardless of their compensation level.

Plan Mechanics: What Employers Must Configure

For affected employees, payroll and retirement plan systems must correctly identify who is subject to the rule each year, and the plan itself must offer a Roth contribution feature for those employees to use. This creates a compliance trap: a plan that does not currently offer Roth deferrals cannot simply exempt high earners from the catch-up rule — instead, those employees are barred from making any catch-up contribution at all until the plan is amended to add a Roth option.

Many plan administrators use a "deemed election" or "spillover" mechanic: contributions are treated as standard pretax deferrals up to the regular elective deferral limit, and any amount above that limit for an affected high earner is automatically redirected into the plan's Roth source, without requiring a separate affirmative election from the employee for the catch-up portion.

📅 Compliance Deadlines

Treasury Decision 10033

Deadline	Requirement
January 1, 2026	Operational compliance expected (good-faith standard)
December 31, 2026	Formal plan document amendment deadline (most plans)
December 31, 2028	Formal plan amendment deadline for collectively bargained plans

Action Checklist for Payroll and Benefits Teams

Required

Identify employees subject to the $150,000 threshold for 2026

Pull prior-year (2025) FICA wage data by current employer for all plan participants age 50 and older to determine who is subject to mandatory Roth catch-up treatment in 2026.

Required

Confirm your plan offers a Roth contribution option

If your 401(k) or 403(b) plan does not currently offer Roth deferrals, affected high earners cannot make catch-up contributions at all under current rules until the plan is amended to add a Roth feature.

Deadline · Dec 31, 2026

Complete formal plan document amendments

Work with your plan's third-party administrator and legal counsel to formally amend plan documents to reflect the mandatory Roth catch-up requirement before the year-end deadline.

Best Practice

Communicate the change to affected employees

Employees newly subject to mandatory Roth catch-up treatment should understand that their catch-up contributions will now be after-tax, which changes their current-year taxable income compared to prior years.

📎 Source & Attribution

"SECURE 2.0 Act Section 603 — Roth Catch-Up Contribution Requirement"

Source: IRS.gov / Treasury Decision 10033 · Published: September 16, 2025 · View source document ↗

This article represents independent analysis and editorial commentary by the einTime team, prepared for the benefit of payroll professionals. Content draws on publicly available regulatory documents and government publications. All compliance decisions should be verified against applicable regulatory guidance and reviewed with a qualified tax advisor or employment counsel.

Topics

SECURE 2.0 Roth Catch-Up 401(k) 403(b) Retirement Plans IRS

einTime Editorial Team

Payroll Compliance Analysts · einTime Resource Center

The einTime editorial team tracks federal, state, and local regulatory developments affecting payroll operations and translates regulatory complexity into practical guidance for payroll professionals.

📋 In This Article

01What Changed
02The $150,000 Threshold
03Plan Mechanics
04Action Checklist

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SECURE 2.0 Mandatory Roth Catch-Up Contributions: 2026 Compliance Guide

What Changed and Why It Matters

The $150,000 Wage Threshold

Plan Mechanics: What Employers Must Configure

Action Checklist for Payroll and Benefits Teams

Never miss a payroll compliance update

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