---
title: "Roth Catch-Up Contributions in 2026: What Workers 50+ Earning Over $150,000 Need to Know - Renew Wealth Management"
description: "Age 50+ and earned over $150,000? Starting in 2026, your 401(k) and TSP catch-up contributions must be Roth. See who's affected and how it hits your paycheck."
author: Joi
---

![](https://renewwealthmgmt.com/media/yootheme/cache/20/man-working-at-desk-with-calculator-1918215-2036510b.jpg)

# Roth Catch-Up Contributions in 2026: What Workers 50+ Earning Over $150,000 Need to Know

If you're 50 or older and make catch-up contributions to your workplace retirement plan, a change that took effect in 2026 may affect how those contributions are taxed. Under the SECURE 2.0 Act, workers whose prior-year wages from their employer exceeded $150,000 must now make catch-up contributions as Roth (after-tax) contributions instead of traditional pre-tax contributions.



The good news: your contribution limits haven't shrunk. The catch is that the tax break you may have counted on has moved from today to retirement. That can mean a smaller take-home paycheck now, even though you're saving the same amount. Here's what changed, who it applies to, and what 401(k), 403(b), 457(b) and Thrift Savings Plan (TSP) participants should do about it.



## What Changed: The SECURE 2.0 Roth Catch-Up Rule



Section 603 of the SECURE 2.0 Act of 2022 requires higher earners to make catch-up contributions on a Roth basis. The rule was originally slated for 2024, but the IRS granted an administrative transition period so employers and payroll providers could update their systems. That transition ended, and the requirement applies to catch-up contributions made starting January 1, 2026.



Before this change, anyone 50 or older could choose whether catch-up dollars went in pre-tax or as Roth. Now, for workers above the wage threshold, the choice is gone: catch-up contributions must be designated Roth. Contributions up to the standard elective deferral limit are not affected and can still be made pre-tax.



One important detail: the rule applies when the plan offers a Roth option. If your employer's plan doesn't offer Roth contributions and you're above the threshold, you generally can't make catch-up contributions at all until the plan adds a Roth feature.



## Who Is Affected: The $150,000 Wage Threshold



The rule applies if you are catch-up eligible (age 50 or older by year-end) and your FICA wages from the employer sponsoring the plan exceeded $150,000 in the prior year. For 2026 contributions, the test uses your 2025 wages, generally the Social Security wages shown in Box 3 of your W-2.



The statute set the threshold at $145,000, indexed for inflation. In Notice 2025-67, the IRS raised it to $150,000 for determining who must make Roth catch-ups in 2026.



A few points that often cause confusion:



- **It's per employer, not total income.** Wages from different, unrelated employers aren't combined. Someone who earned $95,000 at one employer and $85,000 at another isn't subject to the rule, even though total wages exceed $150,000.
- **It's wages, not household income.** Investment income, a spouse's salary and other non-wage income don't count toward the threshold.
- **It's based on last year.** A raise that pushes you over $150,000 in 2026 affects your catch-up contributions in 2027, not this year.
- **New hires are usually exempt the first year.** If you had no wages from the employer in the prior year, you generally aren't subject to the rule yet.



If your prior-year wages were $150,000 or less, nothing changes: you can keep making catch-up contributions pre-tax, Roth, or both, as your plan allows.



## 2026 Contribution and Catch-Up Limits



The Roth requirement changes the tax treatment of catch-up dollars, not how much you can save. These 2026 limits apply to 401(k), 403(b), governmental 457(b) plans and the TSP:



| Age in 2026 | Standard limit | Catch-up limit | Total you can defer | Catch-up tax treatment if 2025 wages > $150,000 |
| --- | --- | --- | --- | --- |
| Under 50 | $24,500 | None | $24,500 | Not applicable |
| 50–59 and 64+ | $24,500 | $8,000 | $32,500 | Roth only |
| 60–63 | $24,500 | $11,250 | $35,750 | Roth only |



The age 50+ catch-up rose $500 from 2025, while the age 60–63 "super catch-up" stayed at $11,250 because it is now indexed separately. Source: IRS limits as summarized by [PSCA](https://www.psca.org/news/psca-news/2025/11/irs-announces-2026-401k-contribution-limits/).



## How the Roth Catch-Up Rule Affects Your Paycheck



Pre-tax catch-up contributions lower your taxable income today. Roth catch-up contributions don't, so the same contribution costs you more in take-home pay this year. The approximate extra federal income tax for a full catch-up, by marginal bracket:



| Federal bracket | Extra tax on $8,000 catch-up | Per biweekly paycheck | Extra tax on $11,250 catch-up (ages 60–63) | Per biweekly paycheck |
| --- | --- | --- | --- | --- |
| 24% | $1,920 | about $74 | $2,700 | about $104 |
| 32% | $2,560 | about $98 | $3,600 | about $138 |
| 35% | $2,800 | about $108 | $3,938 | about $151 |



State income tax, where it applies, adds to these figures. Actual withholding depends on your W-4, pay schedule and when in the year your catch-up contributions are made.



The trade-off works in your favor later. Qualified Roth withdrawals, including earnings, are tax-free once you're 59½ and the Roth account has met the five-year rule. Roth dollars also give you a tax-free bucket to draw from in retirement, which can help manage your bracket, Medicare premium surcharges (IRMAA) and the taxation of Social Security benefits.



## What Federal Employees in the TSP Should Know



The Roth catch-up rule applies to the Thrift Savings Plan just as it does to private-sector 401(k) plans. If your 2025 FICA wages from your federal employer exceeded $150,000 and you're 50 or older, your 2026 TSP catch-up contributions must go to your Roth TSP balance.



The TSP has made this largely automatic. Since 2024, the TSP has used a "spillover" method, so there's no separate catch-up election. According to TSP guidance shared by federal agencies, here's how it works for affected participants:



- **If you contribute only to traditional TSP:** once your contributions reach the $24,500 elective deferral limit, additional contributions automatically switch to Roth TSP. You don't need to file anything.
- **If you contribute to both traditional and Roth TSP:** Roth contributions you make during the year count toward satisfying the Roth catch-up requirement, up to your catch-up limit.
- **If you don't have a Roth TSP balance yet:** your first Roth contribution automatically creates one.



Only wages from TSP-eligible federal positions count toward the threshold. Agency automatic (1%) and matching contributions continue to go to your traditional balance and aren't affected.



Federal employees should check a few things now. Look at Box 3 of your 2025 W-2 to see whether you're over $150,000. Review your leave and earnings statement to confirm catch-up dollars are landing in Roth. And if you're near the threshold, remember that 2026 wages, including any raise, step increase or overtime, will decide your 2027 treatment.



## How to Adjust Your Retirement Strategy



The rule doesn't have to derail your plan. These steps help you stay on track:



1. **Confirm whether you're affected.** Check last year's W-2 (Box 3) from the employer that sponsors your plan.
2. **Make sure your plan offers Roth.** If it doesn't, ask HR whether a Roth option is coming, since you may otherwise lose access to catch-up contributions.
3. **Plan for a smaller paycheck.** Budget for the extra tax, or review your W-4 withholding so you aren't surprised at tax time.
4. **Keep contributing.** Losing the upfront deduction isn't a reason to stop. Tax-free growth on catch-up dollars can be valuable, especially if you expect similar or higher tax rates in retirement.
5. **Rebalance your tax mix.** If catch-ups are now Roth, you might keep more of your regular contributions pre-tax to preserve some current-year deduction.
6. **Look at other pre-tax options.** An HSA (if eligible) can still reduce taxable income, including its $1,000 catch-up for those 55 and older.
7. **Talk to a professional.** A tax advisor or financial planner can model how Roth catch-ups fit with your retirement income, Required Minimum Distributions and estate plans.



## Frequently Asked Questions



### Do I have to make catch-up contributions as Roth in 2026?



Only if you're 50 or older and your 2025 FICA wages from the employer sponsoring your plan exceeded $150,000. Otherwise, you can still choose pre-tax or Roth catch-ups.



### Does the Roth catch-up rule lower my contribution limit?



No. In 2026 you can still contribute $24,500 plus an $8,000 catch-up, or $11,250 if you're 60 to 63. Only the tax treatment of the catch-up portion changes.



### Are my regular 401(k) or TSP contributions affected?



No. Contributions up to the $24,500 standard limit can still be made pre-tax. The Roth requirement applies only to catch-up dollars.



### What wages count toward the $150,000 threshold?



Prior-year FICA wages from the employer sponsoring the plan, typically Box 3 of your W-2. Wages from separate, unrelated employers aren't combined.



### What if my plan doesn't offer a Roth option?



If you're over the threshold and your plan has no Roth feature, you generally can't make catch-up contributions. Employees under the threshold can still make pre-tax catch-ups.



### Do TSP participants need to change their elections?



Usually not. The TSP automatically directs contributions above the $24,500 limit to Roth TSP for affected participants. It's still worth confirming on your leave and earnings statement.



## The Bottom Line



The 2026 Roth catch-up rule doesn't take away your ability to save more after 50. It changes when you pay tax on those extra dollars. If you earned more than $150,000 from your employer last year, expect a smaller paycheck in exchange for tax-free income later. Review your W-2, confirm your plan's Roth setup, and adjust your budget and tax strategy so this change works for your retirement rather than against it.



## Get Help Planning Your Catch-Up Strategy



Not sure how the Roth catch-up rule affects your paycheck, your TSP or your retirement timeline? [Renew Wealth Management](https://www.renewwealthmgmt.com/) is an independent, fee-only fiduciary advisor serving military veterans, federal civil servants and their families in the Washington, D.C. metro area and beyond.



We help you look at the whole picture, not just one contribution election. Our [services](https://renewwealthmgmt.com/services.html) include [tax planning](https://renewwealthmgmt.com/services.html#taxes), [retirement planning](https://renewwealthmgmt.com/services.html#retirement-planning) and [estate planning](https://renewwealthmgmt.com/services.html#estate-planning), along with investment management and comprehensive financial planning. We'll review your situation, model the impact of Roth catch-ups on your taxes and TSP, and build a plan that fits your goals.



[**Schedule a complimentary consultation**](https://calendly.com/jsimon-jhe/complimentary-consultation) or visit [renewwealthmgmt.com](https://www.renewwealthmgmt.com/) to learn more.



*This article is for general educational purposes and is not tax, legal or investment advice. Rules may change, and individual circumstances vary. Consult a qualified tax professional or financial advisor about your situation.*



### Sources



- [IRS announces 2026 401(k) contribution limits (PSCA)](https://www.psca.org/news/psca-news/2025/11/irs-announces-2026-401k-contribution-limits/)
- [What is the wage threshold requiring Roth catch-ups in 2026? (PLANSPONSOR)](https://www.plansponsor.com/?p=194488)
- [Changes to TSP catch-up contributions (Military Spouse Career Center)](https://mccareer.org/2025/11/28/finance-friday-articles-348/)
- [Catch-up contributions 2026 (Mercer Advisors)](https://www.merceradvisors.com/retirement/catch-up-contributions-2026-whats-new-for-savers/)

- Created on 13 October 2026.