2026 401(k) catchup-contributions: Key changes and how to prepare for them

Individuals with a 401(k) and who are nearing retirement may be thinking about how to maximize their contributions. And now’s a good time: With the arrival of the new year, new rules concerning retirement plans – including catch-up contributions – have just gone into effect.

For some background, the Setting Every Community Up for Retirement Enhancement (SECURE) Act, originally passed in late 2019, is federal legislation aimed at strengthening the American retirement system. In 2022, lawmakers passed the SECURE 2.0 Act (SECURE 2.0), which featured a new wave of updates designed to boost savings and modernize retirement plan rules. Some of the biggest changes, including those related to 401(k) catch-up contributions, were introduced in tax year 2025 or rolled out in early 2026. Here are the key catch-up contribution updates you need to know about.

What’s changing for 401(k) catch-up contributions in 2026?

Every year, the IRS sets a cap on the amount of money employees with access to a 401(k) can contribute to their plans through elective deferrals (specified amounts transferred from an employee’s paycheck to a designated retirement plan). In addition to this initial cap, though, plan participants age 50 and older are allowed to make supplemental “catch-up” contributions up to a certain dollar amount, also specified by the IRS each year.

In 2025, for example, all 401(k) plan participants could contribute up to $23,500 through elective deferrals, but those 50 and older could make up to $7,500 in additional catch-up contributions. In 2026, the limits are $24,500 and $8,000, respectively. These extra contributions can help boost an employee’s 401(k) balance in the final years leading up to retirement.

New 401(k) catch-up rules

SECURE 2.0 introduced staggered changes to 401(k) catch-up contributions, with the final regulations clarifying the new rules published on September 16, 2025. Let’s walk through two of the most significant changes – the “super” catch-up limit for individuals ages 60–63 and the requirement that high earners make catch-up contributions on a Roth basis only.

Increased “super” catch-up limit for those ages 60–63

Historically, 401(k) catch-up contributions have been structured as an additional threshold beyond elective deferrals; plan participants age 50 and over can contribute up to this additional threshold amount each year. As mentioned, qualifying plan participants in 2025 could make up to $7,500 in catch-up contributions, on top of the $23,500 elective deferral limit.

Also in 2025, the IRS introduced “super” catch-up limits for 401(k) plan participants ages 60 to 63. These individuals can now contribute $10,000 or 150% of the regular catch-up limit, whichever is greater. (The $10,000 base is indexed for inflation, so that amount will increase over time.) For 2025, the super catch-up limit was $11,250, or 150% of the regular catch-up limit of $7,500. For 2026, the super catch-up limit remains the same ($11,250), even though the regular catch-up limit has increased to $8,000.

While the new super catch-up limit can offer an extra boost for plan participants in the final years before they retire, plan providers can decide whether to offer the new higher limit – or not. Employers can even exclude certain groups, such as union employees, from participating.

High earners eligible for Roth catch-up contributions only

Another key provision of SECURE 2.0 concerns “high-earning” 401(k) plan participants. Starting in 2026, catch-up contributions must be designated as Roth contributions for participants who are officially considered high earners. This is a departure from the previous rule, which allowed participants to opt for either pre-tax or Roth catch-up contributions (when the latter was an available option).

Under the new rule, high earners are defined as plan participants whose prior-year Federal Insurance Contributions Act (FICA) wages from the employer sponsoring their plan exceeded the Roth catch-up wage threshold. The initial threshold of $145,000 will be adjusted over time to reflect changes in the cost of living. Participants who earned more than $150,000 in FICA wages in 2025 are considered high earners for 2026. Plan providers are required to begin implementing this change in 2026 and must be fully compliant by 2027.

Implications of the new Roth catch-up rule

The new Roth catch-up rule will impact high-earning plan participants who want to make catch-up payments, as well as plan sponsors and administrators. Let’s consider the ramifications for each of these groups.

High-earning plan participants

As mentioned, high-earning 401(k) plan participants are those who received more than the FICA wage limit from the employer sponsoring their plan in the preceding calendar year. Going forward, these participants will be allowed to make Roth catch-up contributions only, provided their plans allow for a Roth option.

This new provision presents both pros and cons for high-earning participants. On the upside, qualified withdrawals of Roth contributions and earnings are tax-free in retirement. Roth 401(k)s are also no longer subject to required minimum distributions like their traditional counterparts, so your money can benefit from tax-free growth for longer. Plus, if your employer allows for Roth catch-up contributions, the new requirement effectively opens up a Roth savings vehicle to high earners who are otherwise limited by the income phaseouts of Roth IRAs (individual retirement accounts).

On the downside, high earners will no longer get an immediate tax break from pre-tax 401(k) catch-up contributions. Their taxable income will be higher, and that can lead to a higher effective tax rate. Perhaps most significantly, though, if their employers’ retirement plan doesn’t offer a Roth option, these individuals will lose the ability to make catch-up contributions altogether.

Plan sponsors

Beginning in 2026, plan sponsors can only accept catch-up contributions as Roth from plan participants who are considered high earners under the new law. If employers don’t offer the Roth feature, they won’t be able to support catch-up contributions for high earners unless they amend their plans.

It should be noted that employers can choose to aggregate FICA wages paid across controlled group members or common paymaster arrangements to determine whether an employee meets the high-earner threshold.

Plan administrators

Plan administrators will also face new challenges related to identifying eligible participants, ensuring proper tax treatment and maintaining compliance. For example, they’ll need to update their systems to track the FICA wages of employees from preceding years and ensure they can correctly process Roth catch-up payments for high earners.

Note: The super catch-up limit replaces the standard catch-up limit for plan participants ages 60 to 63; it is not in addition to the standard catch-up contribution limit.

The bottom line

The changes to 401(k) catch-up contributions introduced by SECURE 2.0 may impact your retirement and tax planning. If you fall between the ages of 60 and 63 in 2026, for example, you can contribute an additional $3,250 to your 401(k) plan – on top of the standard $8,000 catch-up limit – provided your plan allows for super catch-up contributions.

Regarding the new Roth catch-up contribution requirement for high earners, review your income to determine if it will apply to you moving forward. If you fall into the high-earner category, you’ll want to check if your plan sponsor allows Roth contributions, then adjust your strategy accordingly: If Roth contributions aren’t allowed on your plan, for example, you likely won’t be able to make catch-up contributions. If they are, however, you’ll need to plan for post-tax rather than pre-tax contributions, as well as for tax-free qualified withdrawals in retirement.

The key to navigating the changes is knowing how they’ll pertain to you and being nimble with your strategy. If you think you might benefit from additional support as the rules roll out, you may want to consider connecting with a financial advisor.

View Disclosures