Updated Roth Regulations and COLA Limits

The IRS has announced the cost-of-living adjustments for various retirement plan limits, which took effect on January 1, 2026.

In addition to the normal increase in limits, the IRS has made a decision to retroactively increase the Roth Catch-up FICA Wages (Box 3 of the W-2)

Lookback from $145,000 to $150,000 for 2025. Plan Sponsors must use this limitation to determine who the Highly Paid Individuals (HPIs) are for

2026. HPIs are required to make their Catch-Up Contributions as Roth Deferrals instead of 401(k) Deferrals.