Overview
- Employees age 50+ with prior‑year wages above an indexed $145,000 must make catch‑up contributions on a Roth basis beginning with 2027 contributions, with later applicability for certain governmental and collectively bargained plans.
- Plan documents generally must be amended by December 31, 2026, and sponsors may rely on reasonable, good‑faith interpretations until full effectiveness in 2027, as the prior transition period ends after 2025.
- Employers may elect to aggregate wages across related employers or common paymasters to determine threshold status, and plans can use deemed Roth elections for affected participants if a new election opportunity is provided.
- If a plan does not offer Roth contributions, participants who exceed the wage threshold will not be permitted to make catch‑up contributions.
- The final rules reflect SECURE 2.0’s higher “super” catch‑up limits for ages 60–63 effective in 2025 and outline correction methods for misclassified contributions, including W‑2 corrections or in‑plan Roth rollovers.