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ARTICLE · 06 NOVEMBER 2025

IRS Issues Roth Catch-Up Contribution Rules For Highly Paid Participants

Ogletree, Deakins, Nash, Smoak & Stewart
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On September 16, 2025, the Internal Revenue Service (IRS) released a final regulation providing guidance on how plan sponsors should implement a requirement under the SECURE 2.0 Act...

United StatesEmployment and HR
Katrina M. Clingerman
Katrina M. Clingerman
David Rosner
David Rosner
Leah J. Shepherd
Leah J. Shepherd
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On September 16, 2025, the Internal Revenue Service (IRS) released a final regulation providing guidance on how plan sponsors should implement a requirement under the SECURE 2.0 Act for catch-up contributions in retirement plans. For plan participants whose Federal Insurance Contributions Act (FICA) wages for the prior year exceed $145,000 (adjusted for cost-of-living in future years), the law requires that catch-up contributions be made to a plan on a Roth basis only—no pre-tax option is available. This requirement applies to 401(k) plans, 401(a) plans, 403(b) plans, and 457(b) plans.

Quick Hits

  • Employees who earned more than $145,000 for the prior taxable year will be able to make catch-up contributions as Roth contributions, but not as pre-tax contributions.

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