Starting January 1, 2026, in compliance with SECURE 2.0 Act, age 50+ catch-up contributions made to a retirement plan must be designated as Roth (post-tax) contributions for participants who earned FICA wages in excess of $150,000 in the prior year (tax year 2025) from RCUH. Under this provision, starting in 2026, the new Roth catch-up contribution rule applies to an employee who participates in a 403(b) (RCUH Supplemental Retirement Annuity – SRA) and whose prior year FICA wages exceeded the threshhold adjusted for inflation annually.
Who is affected by this?
Individuals who:
- Earned more than $150,000 in the prior year (FICA wages in tax year 2025)
- Will be age 50 by December 31, 2026 (are eligible for age 50+ catch-up contributions)
What is SECURE 2.0?
The Securing a Strong Retirement Act (SECURE 2.0 Act of 2022), was signed into law on December 29, 2022. This legislation included provisions intended to make retirement plans more widely accessible, reinforce the importance of saving and offer many American workers the opportunity for greater financial security in retirement.
RCUH will soon be offering two types of contributions to Supplemental Retirement Annuity (SRA) 403(b) retirement accounts (Voluntary Roth contributions coming soon!).
How do I choose between Traditional (pre-tax) and Roth (after-tax) options?
Contact your financial advisor to discuss what is best for you and your personal finances.
Link to: TIAA Financial Essentials: Choosing between pre-tax and Roth after-tax options
What action do you need from me? Do I need to submit a new form?
No immediate action needed.
RCUH will be implementing a new online salary reduction form soon that offers both Traditional (pre-tax) and Roth (post-tax) contributions. No new forms needed if you would like to continue the Traditional (pre-tax) contributions up to the maximum employee contribution. Once you hit the maximum employee contribution, any additional “catch-up” or “super catch-up” contributions will be automatically designated as Roth (post-tax) contributions.
Up to the base maximum contribution amount: Traditional (pre-tax) salary reduction designations (forms submitted prior to RCUH’s Roth (post-tax) option) will remain as Traditional (pre-tax) contributions up to the maximum amount allowed by the IRS. automatically converted to Roth (post-tax contributions).
“Catch-up” and “Super Catch-up” contributions: Any contribution above the Maximum Contribution will be contributed as Roth only
| Active employee in the plan | Maximum Contribution (Type) | Catch Up Contribution (Type) | Overall Contribution |
| Age 50-59 (Catch-up) | $24,500 (Traditional or Roth) | Additional $7,500 (Roth only) | TOTAL Traditional + Roth $32,500 Traditional cannot exceed $24,500 |
| Age 60-63 (Super Catch-up eligible) | $24,500 (Traditional or Roth) | Additional $11,250 (Roth only) | TOTAL Traditional + Roth $35,750 Traditional cannot exceed $24,500 |
| Age 64 or older (Catch-up eligible) | $24,500 (Traditional or Roth) | Additional $7,500 (Roth only) | TOTAL Traditional + Roth $32,500 Traditional cannot exceed $24,500 |
RCUH does NOT automatically adjust your SRA contributions every year. Therefore, if you have previously elected the maximum allowable contributions, you must recalculate and submit a new form. (Helpful tip: The last RCUH pay period in tax year 2026 is December 1-15, 2026 – pay day December 22, 2026!)
If you have any questions, please contact RCUH Human Resource Employee Benefits section at:
Email: [email protected]
Phone: (808) 956-7055 or (808) 956-2326
Relevant Links:
- IRS 2025-103 (October 9, 2025)
- RCUH Policy 3.560 Retirement Plans
- Benefits Spotlight Series: Retirement Accounts (Including: information on the two types of RCUH retirement accounts, SRA Maximum Allowable Calculator, and Frequently Asked Questions)
- RCUH Supplemental Retirement Annuity (SRA) 403(b) Plan Agreement for Salary Reduction Form (Roth post-tax option – coming soon!)
This material is for informational or educational purposes only and should not be considered fiduciary investment advice. This material does not consider an individual’s circumstances which should be the basis of any investment decision. Please consult your tax or legal advisor to address your specific circumstances.
