The U.S. Treasury Department and the Internal Revenue Service (IRS) have issued the final regulations for retirement “catch-up” contributions, outlining the application of the SECURE 2.0 Act provisions.
New SECURE 2.0 Rules Impact High-Income Workers
The finalized rules, released this week, detail the implementation of the Roth catch-up requirement, which will affect certain higher-income workers.
“Catch-up” contributions allow employees aged 50 and older to contribute additional funds to workplace retirement plans. The SECURE 2.0 Act now requires some higher-income workers to make these contributions on an after-tax Roth basis instead of pre-tax.
Under the SECURE 2.0 Act, higher-income workers earning $145,000 or more must direct their “catch-up” contributions into Roth accounts rather than pre-tax accounts. This means they'll pay taxes on those contributions upfront, but the funds will grow tax-free and can be withdrawn without tax in the future.
The finalized regulations also cover additional provisions of the SECURE 2.0 Act, such as increased catch-up contribution limits for workers aged 60 to 63 and guidelines for employees participating in newly established SIMPLE retirement plans.
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Revamped Rules Boost Retirement Savings by 2027
Starting in 2027, new Roth catch-up contribution rules will apply to contributions made for taxable years beginning after December 31, 2026. However, some government and collectively bargained plans will have delayed implementation dates.
The SECURE 2.0 Act is a major federal retirement law that mainly affects workplace retirement plans, including 401(k), 403(b), SIMPLE, and IRA accounts. It was signed into law in December 2022, builds on the original SECURE Act of 2019 and encompassing over 90 provisions aimed at broadening retirement plan access, increasing savings, and simplifying plan administration.
IRS Denies Stimulus Check Rumor; Retirement Trends Shift
The IRS has been actively working to streamline tax-related matters. Previously, it denied rumors of a new $1,390 stimulus check, designed to support low and middle-income consumers in navigating the current cost-of-living crisis
The retirement landscape has also been shifting, with one in three Americans delaying retirement due to economic uncertainty and inflation. Despite this, retirement accounts have been growing, with 401(k)-created millionaires reaching a record high in Q2 2025. The new regulations under the SECURE 2.0 Act could further impact these trends, especially for higher-income workers.
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