RS Issues Final Rules on Roth Catch-Up Contributions

Roth Catch-Up Contributions

On Sept. 15, 2025, the IRS and Treasury issued final regulations under SECURE 2.0 that require certain retirement plan catch-up contributions to be made as after-tax Roth contributions. The rule applies to employees age 50 or older who earned over $145,000 (indexed annually) in wages subject to FICA with their current employer in the preceding year. Plans under §401(k), §403(b) and governmental §457(b) plans must comply for tax years beginning after Dec. 31, 2026. Later dates may apply for governmental plans or those plans under collective bargaining agreements.

The final rules give plan administrators tools for correcting prior contributions and allow for wages from separate common-law employers to aggregate in some cases. Plans may also adopt the Roth requirement earlier under a “reasonable good-faith interpretation” of the statute. These changes will affect retirement plan operations, payroll systems and plan design, so tax pros should review with clients and administrators now.