If you choose to offer age 50 catch-up, these contributions will need to be made as Roth for participants exceeding $145,000 in FICA wages with the employer in the prior calendar year, starting on January 1, 2026. You will also need to track FICA wages and provide this information to your recordkeeper to comply with the new provision before 2026.

You will need to adjust your plan design to include Roth deferrals before January 1, 2026. For participants exceeding $145,000 in FICA wages with the employer in the prior calendar year, starting in 2026, their age 50 catch-up contributions will need to be made as Roth. You will also need to track FICA wages and provide this information to your recordkeeper to comply with the new provision before 2026.

 

Note – legislative guidance has been requested to address whether a plan design can exclude offering Roth and discontinue catch-up for employees who exceed $145,000 in FICA wages with the employer in the prior calendar year. Nationwide will provide an update if this guidance is received. We also recommend that you seek guidance with your legal counsel to discuss this and any plan design decisions.

You do not need to make any plan changes to comply with the new provision in 2026. Make note of the requirements that will take place on January 1, 2026 and know that if you plan to add age 50 catch-up, you will also need to add Roth and track FICA wages so you can provide this information to your recordkeeper to comply with the provision.