SECURE 2.0 Act Reduces 401(k) Tax Savings for Higher Earners Over 50

Higher earners over 50 will lose pre-tax 401(k) "catch-up" contributions starting in 2026 due to the SECURE 2.0 Act.
These catch-up contributions will have to go to after-tax Roth accounts instead.
This reduces tax savings now but allows tax-free withdrawals in retirement.
Those who may retire in the same tax bracket can benefit more from Roths.
Companies worried about quick implementation, so changes are delayed until 2028.

yahoo.com

Relevant topic timeline:

8/25/2023

IRS offers extra time for Roth catch-up contributions

The Internal Revenue Service has extended the deadline for compliance with the new requirement for Roth catch-up contributions until 2026, allowing higher-income participants in retirement plans to designate their catch-up contributions as after-tax Roth contributions.

8/25/2023

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

The IRS will grant a two-year transition period for retirement plans to comply with a new policy on high-income catch-up contributions, providing relief to the industry.

8/28/2023

IRS delays change for 401(k) catch-up contributions. Here's what higher earners need to know

The IRS has announced a two-year delay on a change that would have eliminated the upfront tax break on catch-up contributions for higher earners, allowing them to continue making pretax catch-up contributions to retirement plans through 2025.

8/29/2023

IRS Pushes Back New Roth 401(k) Catch-Up Rules. What to Know.

The IRS has postponed the implementation of a new rule that would require higher earners to make catch-up 401(k) contributions on an after-tax basis into a Roth account, rather than pretax.