Starting in 2026, a new SECURE 2.0 provision requires certain high earners to make their 401(k) catch up contributions as Roth dollars instead of pretax dollars. This only affects a specific group of savers, but if you fall into it, you might notice it in your paycheck.

Who This Rule Affects

This rule only applies if you meet two conditions at the same time.

First, you are age 50 or older. That is the age where the IRS already allows you to make catch up contributions once you hit the standard 401(k) limit. For 2026, that standard limit is $24,500.

Second, you earned more than $150,000 in FICA wages from your employer in the prior year.

If you meet both of those, your catch up contributions have to go in as Roth. If you’re under 50, or you’re 50 or older but earned less than $150,000 in FICA wages last year, this rule does not change anything for you.

What a Catch Up Contribution Actually Is

A catch up contribution is the extra amount the IRS lets you contribute to your 401(k) once you turn 50, on top of the standard limit everyone else is capped at. It exists so people closer to retirement can accelerate their savings in the years when they often have more income and fewer competing expenses.

The Upside You Might Be Missing

Money that goes into a Roth account grows tax deferred, and once the account has been open for at least five years, it comes out completely tax free in retirement. So, while you are paying more in taxes today on that catch up portion, you are locking in tax free growth and tax-free withdrawals later.

This rule only affects a subset of savers, but it lands on people in a specific and important phase of their career, the years right before retirement when they are trying to save the most. Understanding why your paycheck changed, and what you are getting in exchange, makes it a lot easier to plan around instead of just feeling caught off guard by it.

If you have questions about how this affects your 401(k) or your broader financial plan, reach out to our team.