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Beginning in 2026, for 401(k), 403(b), and governmental 457(b) plans that offer catch-up contributions, participants age 50 or older with prior-year FICA wages above $150,000 in 2025 must make any catch-up contributions as designated Roth contributions. Final regulations are applicable in 2027. For 2026, the IRS will deem plans that operate using a reasonable, good-faith interpretation of IRC Sec. 414(v) regarding catch-ups as compliant. Below are the key takeaways and action steps to help plan sponsors and participants prepare.
The wage threshold is determined per employer and uses Box 3 wages from Form W-2. For 2026, apply $150,000 as the threshold. However, plans may elect to aggregate wages from different entities in certain situations.
Deemed election: A plan may provide that a participant subject to the Roth catch-up requirement is deemed to have irrevocably designated any catch-up contributions as designated Roth contributions. The plan must treat these contributions as includible in gross income, maintain them in a separate Roth account, and the employee must have an effective opportunity to elect out of such treatment.
Where a participant makes pre-tax catch-up contributions that should have been designated Roth contributions, if the deemed election provision is in place, the plan can take advantage of two new correction options. Both methods must be applied consistently for similarly situated participants, and the general deadline for correction is by the end of the following year for the affected contribution, unless an earlier correction deadline applies (e.g., for excess deferrals).
Change the Form W-2 (allowed only if the employer has not already filed the form). This involves transferring the contributions and earnings to the designated Roth contribution account and reporting only the amount contributed as a designated Roth contribution on the participant’s Form W-2.
Roll over the contributions and earnings to the designated Roth contribution account. Report the full amount as an in-plan conversion on Form 1099-R. The participant includes the amount in taxable income.
Plans are not required to offer catch-up contributions (although nearly all plans do.)
Plans are not required to have a designated Roth contribution feature (although nearly all plans do.)
If a plan offers catch-up contributions and not designated Roth contributions, participants above the wage threshold cannot make catch-up contributions at all in that year. Those under the threshold could continue to make pre-tax catch-ups.
Plans may not mandate Roth catch-ups for all. Therefore, tracking who hits the wage threshold is mandatory unless all catch-ups are eliminated.
If a plan intends to implement a deemed Roth election, the terms of the plan document must reflect it.
Plan sponsors must confirm that payroll and recordkeeping providers can accurately administer both the Roth catch-up mandate and super catch-up limits (for ages 60-63)—especially when tracking FICA wages, managing multiple entities, and reporting corrections.
Review with clients whether their plans offer a designated Roth feature. If not, discuss with them whether they should consider adopting one or be prepared to limit catch-up contributions for those with FICA wages over $150,000.
Help clients audit payroll and recordkeeping systems to ensure they can accurately track the FICA wage threshold and super catch-up eligibility.
Assist with updating procedures and plan documents by the amendment deadline (generally December 31, 2026) to reflect final regulation requirements.
Help coordinate training for HR and payroll staff, especially regarding how Roth catch-up contributions affect taxable income and distributions.
Help clients coordinate with service providers to implement corrections and ensure plan compliance.
IRS Notice 2025-68, released on December 2, outlines how new “Trump accounts” will operate under IRC §530A and related provisions. The notice also launches a pilot program that “seeds” accounts for U.S. citizens born from 2025 through 2028 with federal contributions. Contributions from parents, employers, or others, and other account operations, cannot begin until July 4, 2026. Notice 2025-68 represents initial guidance and requests public comments by February 20, 2026. The IRS expects to issue more detailed proposed regulations. Unresolved issues remain, including the coordination with cafeteria plans, formal designation of trustees, rollover procedures, and how the account converts to a traditional IRA at age 18.
Trump Accounts are a new type of IRA-like savings vehicle, intended for children under 18 (eligible individuals are those “who have not attained age 18 before the close of the calendar year in which the election is made,” and who have a Social Security number). To open an account, an authorized individual (parent, guardian, or other eligible adult) must make an election using new IRS Form 4547, Trump Account Election(s), or via a future online tool/application.
The notice provides instructions for establishing an initial Trump Account and electing into a “pilot program.” For U.S. children born between January 1, 2025, and December 31, 2028, the government will make a one-time “seed” contribution of $1,000 to their Trump Account, if elected. That seed contribution is statutorily treated as a “payment against the income tax imposed” and does not count toward the annual contribution limit.
While the beneficiary is under age 18 (i.e., the growth period), Trump Accounts operate under unique contribution rules as summarized next. No deduction is allowed by an individual for any contribution to a Trump account.
| Contributor Type | Annual Limit/Treatment |
| Private/family contributions (e.g., parents, guardians, others) | Up to $5,000 per year (aggregate max) |
| Employer contributions (to employees’ or dependents’ Trump Accounts) | Up to $2,500 per year, and included in the $5,000 aggregate limit |
| $1,000 Government “seed” contribution | One-time; does not count toward the $5,000 limit |
| Contributions by qualifying governments/charities (“general funding contributions”) | Permitted, and not subject to the $5,000 limit |
| Qualified rollover contributions | Transfers to a rollover Trump Account of the entire amount of the child’s prior Trump Account |
Unlike a typical IRA, the child does not need earned income to accept contributions during the growth period. Contributions made for a given year must be made by December 31 of that year (i.e., no carry-back contribution option as there is for standard IRAs).
During the growth period (i.e., until the child turns 18):
Funds must be invested in “eligible investments,” which are mutual funds or exchange-traded funds (ETFs) that track a “qualified index,” generally a broad U.S. equity index (e.g., the S&P 500), or a similar index of U.S. companies.
Special basis rules apply for qualified rollover contributions and contributions from certain other sources.
During the growth period:
Withdrawals are limited to rollovers to another Trump Account, or certain ABLE-type accounts, distributions of excess contributions, or upon the death of the beneficiary. The account cannot be closed and distributed for normal use.
For the calendar year in which the child turns 18, the growth period ends. At that point, the account generally becomes subject to standard traditional IRA rules under IRC §408.
Notice 2025-68 is only initial guidance. More detailed rules — especially around employer contribution plans, trustee selection, and rollover/distribution procedures — are forthcoming.
For plan years beginning after December 31, 2025, SECURE Act 2.0 will require most ERISA-covered defined contribution (DC) and defined benefit (DB) plans to deliver paper benefit statements. For DC plans, participants must receive at least one paper benefit statement each year, unless they have affirmatively consented to receive statements electronically under the older 2002 e-delivery standard (not merely the “notice-and-access” rule). This means most plans that currently rely solely on electronic posting will need to either 1) obtain affirmative e-consents from participants or 2) budget for and operationalize annual paper mailings. The content of the statement does not change—only the delivery method requirement is affected.
DB plans, generally, must provide a paper benefit statement once every three years, with an annual funding or status notice in the off years (which may be delivered electronically under DOL rules). Participants may request a paper copy at any time without charge.
Practically, this means DC plans face annual printing and mailing obligations starting in 2026 unless affirmative consent is in place, while DB plans face a periodic but recurring paper obligation. Plan sponsors should begin vendor coordination and participant consent campaigns in 2025 to manage cost, logistics, and fiduciary documentation.
Alert plan sponsor clients that printing and mailing costs, as well as vendor contracts and address quality controls, will need to be reviewed before the 2026 plan year.
Use the required paper statement as a touchpoint to drive engagement—coordinate statement design with educational inserts, QR codes, and calls to schedule advice sessions.
Confirm that participant communication policies and election processes clearly document when an individual has opted out of paper statements.
A November 1, 2025, IRS Notice 2025-67 includes the 2026 cost-of-living adjustments (COLAs) for IRA and retirement plan related dollar limits. Key numbers are shown in the tables.
| IRA Limits | 2026 | 2025 | 2024 |
| IRA Contribution Limit | $7,500 | $7,000 | $7,000 |
| IRA Catch-Up Contributions | $1,100 | $1,000 | $1,000 |
| Joint Return covered by workplace retirement plan | $129,000–$149,000 | $126,000–$146,000 | $123,000–$143,000 |
| Single or Head of Household covered by workplace retirement plan | $81,000–$91,000 | $79,000–$89,000 | $77,000–$87,000 |
| Joint Return spouse not covered by workplace retirement plan | $242,000–$252,000 | $236,000–$246,000 | $230,000–$240,000 |
| Married filing separately covered by workplace plan | $0–$10,000 | $0–$10,000 | $0–$10,000 |
| Roth IRA Joint Return | $242,000 – $252,000 | $236,000 – $246,000 | $230,000–$240,000 |
| Roth IRA Single or Head of Household | $153,000 – $168,000 | $150,000 – $165,000 | $146,000–$161,000 |
| Roth IRA Married filing separately | $0–$10,000 | $0–$10,000 | $0–$10,000 |
| Employer Plan Limits | 2026 | 2025 | 2024 |
| Elective Deferral Limit (401(k), 403(b), 457(b) and SARSEP) | $24,500 | $23,500 | $23,000 |
| Age 50 Catch-Up Contribution Limit | $8,000 | $7,500 | $7,500 |
| Roth Catch-Up Threshold (NOTE: Reflects FICA wages paid in 2025) | $150,000 | N/A | N/A |
| Ages 60-63 Catch-Up Limit | $11,250 | $11,250 | N/A |
| Annual Defined Benefit Limit | $290,000 | $280,000 | $275,000 |
| Annual Defined Contribution Limit | $72,000 | $70,000 | $69,000 |
| Annual Compensation Limit | $360,000 | $350,000 | $345,000 |
| Highly Compensated Employee Dollar Threshold | $160,000 | $160,000 | $155,000 |
| SIMPLE Standard Contribution Limit | $17,000 | $16,500 | $16,000 |
| SIMPLE Small Employer Special Contribution Limit | $18,100 (1) | $17,600 (1) | $17,600 |
| SIMPLE Standard Age-50 Catch-Up Contribution Limit | $4,000 | $3,500 | $3,500 |
| SIMPLE Small Employer Special Age-50 Catch-Up Contribution Limit | $3,850 (2) | $3,850 (2) | $3,850 |
| SIMPLE Age 60-63 Catch-Up Contribution Limit | $5,250 | $5,250 | N/A |
| SEP Coverage Minimum Comp. | $800 | $750 | $750 |
| SEP Compensation Limit | $360,000 | $350,000 | $345,000 |
| Top-Heavy Key Employee Comp. | $235,000 | $230,000 | $220,000 |
| Social Security Taxable Wage Base | $184,500 | $176,100 | $168,600 |
| ESOP maximum amount subject to a 5-year distribution period | $1,455,000 | $1,415,000 | $1,380,000 |
| ESOP maximum amount for lengthening of the 5-year period | $290,000 | $280,000 | $275,000 |
Source: IRS Notice 2025-67
(1) For SIMPLE plans with 25 or fewer employees and SIMPLE plans with 26-100 participants if 4% match or 3% nonelective employer contribution provided
(2) For SIMPLE plans with 25 or fewer employees and SIMPLE plans with 26-100 participants if 4% match or 3% nonelective employer contribution provided
The U.S. Court of Appeals for the Fifth Circuit granted the DOL’s motion to dismiss its appeal of the 2024 investment-advice fiduciary rule and related prohibited transaction exemption (PTE) amendments. The dismissal effectively leaves in place district court stays that blocked those rules from taking effect. As a result, the prior “five-part fiduciary test” and existing PTEs, including un-amended PTE 2020-02, continue to govern retirement advice for the present. More detail at "Fiduciary Rule Update."
Existing ERISA, securities law, and state standards still apply and remain enforceable.
Preserve and refine documentation procedures developed for the 2024 rule (e.g., rollover analysis forms, conflict mitigation policies), using them as de facto best practices.
Watch Congress and the DOL for alternative fiduciary initiatives, including statutory approaches such as the Restoring Integrity in Fiduciary Duty Act.
On September 18, 2025, the Senate confirmed Daniel Aronowitz as Assistant Secretary of Labor overseeing the Employee Benefits Security Administration (EBSA) of the Department of Labor. Aronowitz has a long background in fiduciary law, insurance underwriting, and ESOP matters. He has publicly emphasized improving the fairness and predictability of EBSA enforcement, including ending perceived bias against ESOPs and overly long investigations.
Expect continued emphasis on fiduciary process, but with a greater focus on clear enforcement standards and timely resolution of investigations.
Use the leadership change as a prompt to revisit governance practices, documentation standards, and committee training agendas.
Expect additional EBSA guidance.
Private Letter Ruling (PLR) 202535015 addresses an IRA owner who missed the 60-day rollover deadline because of a fraud scheme but later recovered the stolen funds and sought a waiver. The IRS granted relief, explaining that its discretionary waiver authority under IRC §408(d)(3)(I) can apply where failure to complete a rollover on time results from events beyond the taxpayer’s reasonable control and where equity and good conscience favor relief.
PLR 202535015 involves “Taxpayer A” who withdrew money from a traditional IRA and, because of a fraud scheme, failed to roll that amount into another IRA within the usual 60-day window. According to the facts submitted, the taxpayer was tricked by individuals impersonating their financial institution; the impersonators convinced the taxpayer to wire funds — including the IRA distribution — into a cryptocurrency account. After the taxpayer realized the fraud and reported it, the funds were recovered and returned. Taxpayer A then asked the IRS for a waiver of the 60-day rollover requirement, arguing that the failure to timely rollover was caused by the fraudulent scheme and beyond their control.
The IRS agreed and granted the waiver. Under IRC §408(d)(3)(I), the Secretary has discretionary authority to waive the 60-day rule when failing to rollover in time would be “against equity or good conscience,” such as when the failure results from events beyond the taxpayer’s control (e.g., fraud). Given the documented fraud and recovery of the funds, the IRS concluded that it was appropriate to treat the recovered amount as eligible for rollover. The taxpayer was given a new 60-day period (starting upon issuance of the ruling) to deposit the recovered amount into a rollover IRA — assuming all other rollover requirements are satisfied.
When clients miss the 60-day rollover window due to fraud, disaster, or similar circumstances, consider whether a formal IRS waiver request is appropriate.
Emphasize meticulous documentation of the fraud, recovery of funds, and timeline; these facts are central to the IRS’s analysis in PLR 202535015.
Remind clients that a PLR applies only to a particular taxpayer’s specific facts and cannot be cited as precedent for others. PLRS do, however, offer insight into how the IRS applies its equitable relief standards in compelling cases.
The Restoring Integrity in Fiduciary Duty Act (S.3086, 119th Congress) is a federal bill that seeks to clarify and strengthen fiduciary duty standards, especially around the consideration of nonfinancial factors in investment decisions. Debate in congressional hearings has tied the bill to broader disputes over ERISA litigation, ESG investing, and the appropriate balance between return focused and collateral objectives in fiduciary decision making.
Track the bill’s progress and any companion House proposals, as enacted legislation could change how ERISA and other fiduciary regimes treat ESG and mission related factors.
Help plan fiduciaries and wealth clients articulate their investment policy language so that consideration of nonfinancial factors is clearly framed and subordinated to prudent, loyalty-based standards.
Revisit client expectations about fiduciary duties associated with investment selection and monitoring.