Catch-up Contribution Changes
What You Need to Know
Saving for retirement is getting a boost in 2026, especially for older workers. New IRS rules are expanding catch-up contribution opportunities while also introducing important changes around Roth catch-up contributions.
Whether you’re a plan sponsor or a participant, understanding these updates can help you make smarter retirement planning decisions and avoid surprises.
What Are Catch-Up Contributions?
Catch-up contributions allow participants age 50 and older to contribute more to employer-sponsored retirement plans—such as a 401(k), 403(b), or 457(b)—beyond the standard annual limit.
These contributions are designed to help individuals who:
- Started saving later in their careers
- Took time away from the workforce
- Want to accelerate retirement savings as retirement approaches
For 2026, catch-up contribution limits have been adjusted for inflation and expanded for certain age groups.
Roth Catch-Up Contributions: A Major Change in 2026
One of the most impactful updates affects how catch-up contributions are taxed for higher earners.
Beginning January 1, 2026:
- Participants with prior-year FICA wages from the same employer above the IRS threshold (approximately $150,000 for 2026) must make catch-up contributions as Roth (after-tax) contributions
- Participants earning below the threshold may continue to choose between pre-tax or Roth catch-up contributions, depending on their plan’s provisions
Why Roth Catch-Up Contributions Matter
Roth contributions are taxed today but grow tax-free, and qualified withdrawals in retirement are also tax-free. While Roth contributions may reduce current take-home pay, they can provide meaningful tax flexibility in retirement, especially for participants who expect higher future tax rates.
Super Catch-Up Contributions for Ages 60–63
For workers nearing retirement, the IRS has introduced an enhanced saving opportunity known as the “super” catch-up contribution.
In 2026:
- Participants aged 60, 61, 62, or 63 may contribute up to $11,250 in catch-up contributions
- This is higher than the standard catch-up limit of $8,000 for participants age 50 and older
These expanded limits are designed to help late-career employees take advantage of peak earning years and close potential retirement savings gaps.
What These Catch-Up Contribution Changes Mean for Employers
The 2026 catch-up contribution rules affect more than just participants. They also create new administrative considerations for plan sponsors.
Employers should:
- Review plan documents to confirm whether Roth and super catch-up contributions are permitted
- Coordinate with payroll providers and recordkeepers to ensure systems can apply Roth requirements correctly
- Communicate these changes clearly so participants understand their options and potential tax impact
Final Thoughts on Catch-Up Contributions in 2026
Catch-up contributions have long been a powerful retirement planning tool, and the 2026 updates make them even more impactful, especially for workers approaching retirement. At the same time, new Roth requirements add complexity, making education and planning more important than ever.
If you have questions about how catch-up contribution changes affect your retirement plan or personal savings strategy, let’s connect.
Angela M. Hall, Ph.D., CFP® is Note’s Senior Financial Advisor and head of the Retirement Planning division at Note Advisors. Angela works closely with business owners who need retirement plan options for their employees. As a Certified Financial Planner®, her mission is to guide you in achieving your most ambitious life and business vision by developing and maintaining custom wealth and retirement plan strategies. Connect with her on LinkedIn