What You Need to Know About Mandatory Roth Catch-Up

October 24, 2025

Beginning in 2026, new rules will affect how certain retirement plan catch-up contributions are made. If you are age 50 or older, it's important to understand how this change may apply to you.

• What's Changing for You

• If you earned over $145,000 in FICA wages last year, your catch-up contributions must be made as Roth.
• If you earned less than $145,000, you may continue choosing between Roth or pretax contributions (if your plan allows both).
• Catch-up contribution limits are not changing. The rules only affect the tax treatment of those contributions.

Note: These rules apply only to individuals with FICA wages. Sole proprietors and partners have earned income, not FICA wages, so this requirement does not apply to them.

• Why It Matters

• Roth contributions are made after-tax but grow tax-free, with tax-free withdrawals in retirement.

• You may lose the upfront tax deduction, but you gain long-term tax advantages.

• What To Do Next

• Check your 2025 wages to determine if you will be above or below the $145,000 threshold.

• Confirm that your plan offers Roth contributions.

• Talk with a financial professional about how Roth contributions fit into your retirement strategy.

• Important Takeaway

Starting January 1, 2026, if you are age 50+ and earned more than $145,000 in prior year FICA wages, your catch-up contributions must be Roth. If your plan does not offer Roth, you will not be able to make catch up contributions. Knowing this now can help you plan ahead and keep your retirement savings on track.