A Major 401(k) Tax Change Takes Effect in 2026 — Higher Earners Over 50 Need to Check Their Contributions

Workers age 50 and older can make additional 401(k) catch-up contributions in 2026, but certain higher earners must make those catch-up dollars as Roth contributions – Shutterstock

For some workers over 50, 2026 changes the tax treatment of 401(k) catch-up contributions. If prior-year wages from the employer sponsoring the plan exceeded $150,000, catch-up contributions generally must go into the plan’s Roth side rather than the traditional pre-tax side.

That does not mean the entire 401(k) contribution suddenly becomes Roth. It applies specifically to catch-up contributions, which sit above the regular annual employee contribution limit. That distinction matters because a payroll setting that looks perfectly normal could produce a different tax result this year.