IRS Will Delay 401(k) Roth Catch-Up Provision Under SECURE 2.0

The IRS will give retirement plans a two-year transition period to comply with a new policy requiring sponsors to treat high-income catch-up contributions as post-tax Roth deferrals.

Regulators issued temporary guidance (Notice 2023-62) Friday establishing an administrative transition period for the provision that will extend until 2026. It does away with an error Congress made when it passed the SECURE 2.0 Act (Pub. L. No. 117-328) late last year that could have resulted in the elimination of catch-up contributions after 2023.

Delayed high-income catch-up contributions will come as a relief to an industry that was prepared ...