Effective Jan. 1, a new federal requirement will impact how certain employees make catch-up contributions to their retirement plans. Specifically, individuals who meet the criteria below will be required to make catch-up contributions on an after-tax Roth basis. Pre-tax catch-up contributions will no longer be permitted for these employees.
This change applies to employees who:
- Will be age 50 or older during calendar year 2026, or
- Had FICA wages from Case Western Reserve University exceeding $150,000 (Social Security wages reported in Box 3 of the W 2) in the 2025 calendar year.
If both conditions apply to you, any contributions made above the standard annual elective deferral limit in 2026 or $24,500 must be designated as Roth (after-tax). Contributions up to the standard limit may still be made as either pre-tax or Roth, based on your election.
No action is required unless you wish to avoid making Roth catch-up contributions. In that case, you must submit a new "Salary Reduction Agreement form" to ensure your total deferrals for 2026 do not exceed the standard annual limit of $24,500 for 2026. If you have questions about how this change may affect your retirement or tax strategy in 2026 and beyond, consult your financial advisor.
Case Western Reserve University is working closely with its retirement plan service providers to implement these changes. Personalized communications will be sent to potentially impacted employees well ahead of the Jan. 1 effective date.
