You guys are once again great…. after multiple contacts from your 401k companies this week, a very pertinent article is in the works…
Mandatory Roth Catchup in 401k’s starting in 2026 preview … Friday
With several questions from you guys in the field due to company notifications, here is a briefer on a new rule coming in 2026 …it was a bit more complicated than first expected… measure twice cut once, so look to the full article soon!
Here is a quick review – there are a few Gotchas in this that need more attention, but here are the basics:
W-2 Income over $150k this year (2025) our 401k Catch ups (50 years young or older extra contribution limit) must be in a Roth
Net Effect is there will be a Roth and regular pre-tax contribution in our current 401k
Slightly extra Federal taxes since we do on get to deduct Roth Contributions
Effectively two buckets of money that when rolled over will need to be separated – here is a Gotcha, more to come
Ahhhh…today is a Friday, next week is a Holiday week…skeleton crews abound- talk next week!
John A. Kvale CFA, CFP
AI Content Authenticity: AI created the splash image. All of the following text content has been completed by myself and has not been edited or created by AI. Occasionally we do use AI for images and will note when appropriate.
Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
