401(k) Catch-Up Contributions at 50 and the Higher Limit at 60 to 63

Workers who are 50 or older can contribute more to a 401(k) than the standard limit, and a higher amount has applied to ages 60 through 63 since 2025. A separate rule that took effect January 1, 2026 requires some higher earners to make their catch-up contributions on a Roth basis. Two features matter here: the higher amount for ages 60 through 63, and the Roth requirement now in effect.

The 2026 limits

For 2026, the limit on employee elective deferrals to a 401(k), 403(b), governmental 457(b) or the federal Thrift Savings Plan is $24,500 (IRS Notice 2025-67), up from $23,500 in 2025. Participants who reach age 50 by December 31 may add a catch-up contribution of $8,000, for a total of $32,500.

Participants who reach age 60, 61, 62 or 63 during 2026 may instead add a catch-up of $11,250, for a total of $35,750. This higher amount comes from the SECURE 2.0 Act, and it equals the greater of $10,000 or 150% of the regular catch-up amount in effect for 2024, indexed for inflation after 2025. It remains $11,250 for 2026. At age 64, the catch-up returns to the standard $8,000.

Catch-up contributions do not count toward the overall limit on total additions to a participant’s account, which is $72,000 for 2026 and covers employee and employer contributions combined. SIMPLE IRA plans have their own catch-up amounts, which this article does not cover.

Who qualifies for each tier

The age test uses the age a participant reaches by the end of the calendar year, not the age on a given paycheck date. A person who turns 50 on December 30 qualifies for the full-year catch-up. A person who turns 60 in 2026 qualifies for the higher amount for the whole year, and a person who turns 64 in 2026 does not.

A catch-up applies only to a participant who is making elective deferrals, and the participant generally reaches it after contributing the standard limit or a lower limit set by the plan. Whether the employer matches catch-up contributions depends on the plan document. The deferral and catch-up limits apply to a person across all 401(k) and 403(b) plans combined, while the Roth wage test described below looks at wages from each plan sponsor separately. Employer contributions, such as a match or profit sharing, are separate from these limits and count toward the $72,000 total. The employer must also have adopted the higher 60 to 63 amount, so not every plan offers it yet.

The Roth catch-up rule that began in 2026

Under Section 603 of the SECURE 2.0 Act, which the IRS has applied since January 1, 2026, a participant whose Social Security wages from the plan sponsor exceeded an indexed threshold in the prior calendar year must make catch-up contributions as Roth contributions, which are made after tax. The threshold was $145,000 for 2024 wages and is $150,000 for 2025 wages (IRS Notice 2025-67). The test looks at wages from the employer sponsoring the plan in the preceding year, so wages in 2025 decide how catch-up contributions are treated in 2026.

Several points follow from the statute. The rule applies only to catch-up contributions, so the standard $24,500 limit can still be pre-tax or Roth, as the plan allows. Participants below the wage threshold may choose pre-tax or Roth catch-up contributions if the plan offers both. A plan that does not offer a Roth option cannot allow affected participants to make catch-up contributions at all. The test uses wages reported for Social Security tax, so partners and sole proprietors, whose earnings are not wages, are generally not subject to it.

The IRS issued proposed regulations in January 2025 and final regulations in September 2025. The final regulations apply to taxable years beginning after December 31, 2026, so they first apply to 2027 contributions, and plans follow a reasonable, good-faith reading of the statute for 2026. The IRS expects the formal plan amendment to be due for most plans by December 31, 2029.

What changes between pre-tax and Roth

A pre-tax catch-up reduces wages subject to income tax in the year of the contribution, and withdrawals are generally taxed as ordinary income. A Roth catch-up produces no deduction in the year of the contribution, and qualified withdrawals are generally tax free once the account has been open five years and the participant is at least 59 and a half. The Roth requirement therefore changes the timing of the tax on catch-up contributions, not the contribution limit. For a Texas resident, the choice affects federal tax only.

Practical points for plan participants

• Whether the plan offers the catch-up, the higher 60 to 63 amount and a Roth option, which the plan document and the plan administrator can confirm.
• Prior-year Social Security wages from the plan sponsor, compared with the indexed threshold, which is $150,000 for 2025 wages.
• How the payroll contribution rate is set, since elections run through payroll and the rate determines how much of the limit is used by the final paycheck of the year.
• How the employer match treats catch-up contributions.
• How a change in pre-tax contributions affects take-home pay, and how a Roth catch-up affects current-year taxable income.
• The year in which a participant turns 60 and the year in which the higher tier ends, at 64.

Plan administrators know whether Roth catch-up contributions are offered, and a tax professional can confirm how the wage test applies to you. If the choice affects your wider retirement savings, your adviser is the person to raise it with.

This article is provided by Austin Wealth Management for general educational purposes only. It is not financial, investment, tax or legal advice, it does not consider your individual circumstances, and it does not create an advisory relationship. Austin Wealth Management provides advice and services only under a signed advisory agreement, and the terms of that agreement govern. Rules and limits change, so information here may not be current. Consult a qualified financial professional before making financial decisions.