US EditionA New 401(k) Restriction Could Lead to a Bigger Tax Bill for These Workers
Employees 50+ earning over $150,000 must make catch-up 401(k) contributions to Roth accounts starting 2026, increasing taxable income by up to $8,000, IRS says.
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3 Articles
A New 401(k) Restriction Could Lead to a Bigger Tax Bill for These Workers
Key PointsAll workers can contribute up to $24,500 to either a traditional 401(k), a Roth 401(k), or both in 2026.Workers 50 and up earning more than $150,000 can only make Roth 401(k) catch-up contributions this year.This could lead to a larger tax bill in the present, but it'll also permit some tax-free retirement withdrawals.The $23,760 Social Security bonus most retirees completely overlook › The whole point of saving money in a retirement a…
New Rules for 401(k) ‘Catch-Up’ Contributions in 2026
If you’re a high-earning, older worker, the rules for making “catch-up” contributions to a 401(k) or similar job-based retirement plan have changed. Starting this year, employees age 50 and older earning more than $150,000 who make contributions beyond the standard allowed amount must deposit that extra money into a Roth 401(k). That means you won’t get an upfront tax break for the extra contributions, and your take-home pay may be lower. Until …
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