IRS Delays Mandatory Roth Catch-Up Contributions for Higher Paid Employees
The IRS provided a two-year administrative transition period delaying the required implementation of the SECURE 2.0 Act’s rule mandating high-paid participants to designate catch-up contributions as Roth contributions, which previously needed to be implemented in 2024
The Internal Revenue Service (IRS) has issued guidance in Notice 2023-62 delaying the mandatory Roth IRA catch-up contribution requirement for high-paid participants until 2026. The SECURE 2.0 Act (Consolidated Appropriations Act, 2023) required plan participants earning over $145,000 in prior-year FICA wages to designate any catch-up contributions as Roth contributions beginning in 2024. In essence, this new rule prohibited high-income earners, ages 50 and over, from making catch-up contributions as pre-tax contributions.
Keep Up to Date in a Changing World
