If you're 50 or older and make catch-up contributions to your workplace retirement plan, a change

If you're 50 or older and make catch-up contributions to your workplace retirement plan, a change in 2026 may affect how those contributions are taxed.

For eligible participants whose prior-year wages from the plan sponsor exceeded the applicable $150,000 threshold, catch-up contributions generally must be made on a Roth basis when the plan offers the required Roth feature. That means paying income tax on those contributions now rather than receiving the same upfront tax treatment as traditional pre-tax contributions.

Your contribution limits may remain available, but the tax impact on your current paycheck can change. Federal employees contributing to the TSP should review how this requirement applies to their situation and retirement strategy.

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