The IRS has finalized regulations that clarify how SECURE 2.0’s Roth catch-up contribution rules must be administered for many employer-sponsored retirement plans. For plan sponsors, the challenge is not only understanding what changed, but also updating payroll, recordkeeping, and plan documents while communicating clearly with participants.
The final rules also confirm a practical reality: 2026 is effectively an implementation “gap year,” and stricter enforcement applies starting on January 1,2027, but that does not mean plan sponsors can wait until the end of 2026 to start.
Below is a sponsor-focused roadmap to help you identify impacted participants, coordinate with vendors, and stay ahead of amendment deadlines.
High-wage employees (over $150,000 in prior-year Social Security wages) can only make Roth catch-up contributions starting in 2026.
2026 is a good-faith transition year; full compliance and plan amendments are due by December 31, 2026.
New “super catch-up” limits apply for ages 60-63, increasing total contribution potential.
Payroll and recordkeeping systems must support age and wage-based Roth tracking and limits.
The final regulations provide operational guidance for:
The Roth catch-up requirement is most relevant for sponsors of:
Important carveouts: The Roth catch-up wage threshold rule is designed around “applicable employer plans” and expressly excludes certain arrangements (notably SEP/SIMPLE) when describing the wage threshold rule mechanics.
|
Date |
What happened/happens | Why it matters |
| September 16, 2025 | IRS published final catch-up contribution regulations | Establishes the definitive compliance framework |
| January 1, 2026 | End of the IRS administrative transition period and start of operational readiness expectations | Sponsors should be able to demonstrate a reasonable, good-faith approach during 2026 |
| December 31, 2026 |
Plan amendment deadline for most qualified plans (regardless if the plan operates on a calendar or a fiscal year basis), excluding governmental plans and union plans |
A hard deadline for adopting required amendments of the SECURE 2.0 Act |
| January 1, 2027 | General applicability for the Roth catch-up provisions in the final regulations | Stricter compliance posture begins for most plans |
| December 31, 2028 | Amendment deadline for plans under collective bargaining | Extended deadline for CBA/union plans |
| December 31, 2029 | Amendment deadline for governmental plans and public-school 403(b)s | Extended deadline for governmental and certain 403(b) sponsors |
What is the definition of a highly paid participant (HPP) and what triggers mandatory Roth catch-ups?
Beginning in 2026 operations, the Roth catch-up requirement is determined using prior-year FICA/Social Security wages.
For the 2026 implementation year, the IRS confirms that:
| Limit Type | 2026 Amount |
| Elective deferral limit (402(g)) | $24,500 |
| Annual defined contribution limit (415(c)) | $72,000 |
| Standard catch-up (age 50+) | $8,000 |
| Super catch-up (ages 60–63) | $11,250 |
Start with a clean process to identify who may be impacted in 2026, including:
Practical tip: Don’t assume only employees who hit the Social Security wage base are affected. The Roth catch-up wage threshold is a separate figure and can capture employees below the maximum taxable wage base.
For most organizations, compliance will be operationally won or lost in payroll and recordkeeping. This is where most failures occur.
Engage your vendor ecosystem early by doing the following:
Your internal checklist should include the following:
Why urgency matters: the IRS did not extend the administrative transition relief beyond December 31, 2025, and expects good-faith implementation during 2026.
For affected employees, the change is straightforward but often unwelcome: their catch-up contributions may no longer be pre-tax.
Consider a communications plan that includes:
This is also a strong opportunity to direct participants to financial education resources and encourage them to consult their tax advisor.
Document work should begin now, even though the main amendment deadline is later.
A key design issue: If your plan offers catch-up contributions but does not currently offer Roth deferrals, you may need to add a Roth feature to allow impacted participants to continue making catch-up contributions as required.
Deadlines to keep in view:
Two realities will persist:
Assign ownership internally for the following tasks:
Catch-up contributions are additional elective deferrals allowed for participants age 50+. Under SECURE 2.0, certain high-wage employees must make those catch-up amounts as Roth (after-tax) contributions.
Employees who are age 50+ and had 2025 Social Security (FICA) wages over $150,000 (Form W-2, Box 3) must designate catch-up contributions in 2026 as Roth.
For 2026: elective deferrals are $24,500, catch-up is $8,000 (age 50+), and super catch-up is $11,250 (ages 60–63).
Most plans must adopt amendments by December 31, 2026, with extended deadlines for collectively bargained plans (2028) and governmental/public-school 403(b) plans (2029).
Plan sponsors that start early tend to experience fewer payroll failures, fewer participant complaints, and smoother plan amendments. Trout CPA stays informed on the SECURE 2.0 Act’s mandatory provisions, and we are available to discuss considerations and questions as clients work with their plan service providers on implementation.
Megan Senkowski, CPA
Megan joined Trout CPA in 2011 and has over 25 years of experience in public accounting. She graduated from Villanova University with a Bachelor of Science degree in Accounting with a minor in Finance. Megan is the chair of the firm's Non-Profit Industry Group and Employee Benefit Plans Practice Group. As an Assurance Partner, Megan handles all aspects of assurance engagements, business consulting, and financial statement preparation for some of the firm’s significant clients.