Mandatory Roth Solo 401k Catch-Up Contributions Begin in 2026: What Self-Employed Individuals and Employers Need to Know
The SECURE Act 2.0 introduced significant changes to retirement plan catch-up contributions—especially for high-earning employees. One of the most impactful updates is the new requirement that certain age-50+ workers must make their catch-up contributions on a Roth basis rather than pre-tax.
This rule was initially scheduled for 2024, but after strong pushback from payroll providers and plan administrators, the IRS granted a two-year delay. Now, with final regulations issued on September 15, 2025, employers and plan providers are preparing for the 2026 rollout.
Below, we break down of common questions (and answers) about the upcoming mandatory Roth solo 401k catch-up requirement.
When Does the Mandatory Roth Catch-Up Rule Take Effect?
The rule becomes effective January 1, 2026 for 401k plans and solo 401k plans.
Plans with non-calendar fiscal years must comply beginning on the first day of their 2026 fiscal year.
Although Congress did not extend the effective date of the law, the IRS did delay the effective date of the final regulations to January 1, 2027, giving plans some administrative flexibility during 2026.
Who Is Affected by the Mandatory Roth Catch-Up Requirement?
You are subject to the rule if:
- You earned more than $150,000 in tax year 2025, indexed annually,
- In W-2 wages (Box 3)
- From your current employer (your self-employed S-corp. C-corp., or LLC taxed as an S-corp., or C-corp.)
- In the prior calendar year
What Wages Count for the Threshold Test?
The rule looks specifically at Box 3 W-2 wages, which represent wages subject to Social Security tax.
Box 1 wages are not used for this determination.
Are Self-Employed Individuals Affected?
Yes, if your self-employed business is an S-corporation, C-corporation or an LLC taxed as an S-corp. or C-corp.
Self-employed individuals—including sole proprietors, partners, and those with self-employment income instead of W-2 wages—are completely exempt from the mandatory Roth catch-up rule, regardless of how high their income is.
This is a key advantage for those using Solo 401(k) plans where the self-employed business is taxed as a sole proprietorship or as partnership, as self-employed individuals can continue to choose between pre-tax and Roth for age-based catch-ups.
Which Retirement Plans Must Comply?
The rule applies to:
- 401k plans
- Solo 401(k) plans
- 403(b) plans
- Governmental 457(b) plans
The rule does not apply to:
- Non-governmental 457(b) plans
- SIMPLE IRAs
- Traditional IRA or Roth IRA catch-up contributions
The mandatory Roth requirement is strictly a qualified plan rule including a solo 401k.
Which Catch-Up Contributions Are Affected?
Both categories of age-based catch-up contributions must follow the Roth rule for high earners:
- The standard age 50+ catch-up (up to $8,000 for 2026)
- The new ages 60–63 “super catch-up” (up to $11,250 for 2026)
If you exceed the wage threshold, all catch-ups must be Roth.
How Does the Rule Apply to New Employees?
Owner employees in the impacted self-employed business (i.e., S-corporation, C-corporation or an LLC taxed as an S-corp. or C-corp.) are never subject to the mandatory Roth rule in their first year of employment because they have no prior-year W-2 wages from the company.
They may also be exempt in their second year if their wages do not exceed the full, un-prorated threshold.
Illustration:
- Jane starts her self-employed S-corporation business on July 1, 2026 at a salary of $300,000.
- She is exempt from the Roth mandate for 2026 because she had no 2025 wages from the self-employed S-corporation.
- If she earns $130,000 in 2026, and the 2026 threshold is $150,000, she will also be exempt in 2027, because the wage threshold is not prorated.
What If a solo 401k Plan Does Not Offer Roth Contributions?
A key clarification:
Solo 401k plan providers are not required to offer plans that allow for Roth solo 401k contributions.
However:
If a solo plan does not offer Roth,
And an owner-employee is subject to the mandatory Roth catch-up,
That employee cannot make any catch-up contributions—pre-tax or Roth.
Only owner employees below the wage threshold would still be allowed to make catch-ups in that situation.
This places strong pressure on solo 401k plan providers to add Roth features to their solo 401k plans to avoid excluding high-earning owner-only employees from catch-up opportunities altogether.
Key Takeaways
- Mandatory Roth catch-ups begin January 1, 2026.
- Applies to employees earning more than $150,000 (indexed) in Box 3 wages.
- Self-employed individuals with Solo 401(k)s are exempt from the rule if their self-employed business is a taxed as sole proprietorship or partnership.
- Affects age-50+ catch-ups and the ages 60–63 “super catch-up.”
- Solo 401k Plans without Roth options may need to update documents to avoid high earners in their self-employed S-corporation, C-corporation or an LLC taxed as an S-corp. or C-corp. from catch-ups.
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