A new 401(k) rule is coming in 2026 for millions of high-earning Americans. What to know if you’re in this group

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If you’re middle-aged and successful a high-income bracket, the mode you lend to your 401(k) volition alteration arsenic of adjacent year.

This September, the Internal Revenue Service (IRS) announced caller regulations changing the mode catch-up contributions enactment starting successful 2026. Specifically, the IRS has introduced a caller income trial for taxpayers looking to lend to peculiar status accounts, and it could deed precocious earners hard.

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Here’s what you request to know.

In 2025, each workers tin lend up to $23,500 into 401(k) plans. However, workers implicit the property of 50 tin marque catch-up contributions to prevention much successful these tax-advantaged accounts arsenic they attack retirement.

Typically, workers person the prime to put catch-up funds successful either a regular 401(k) program oregon a Roth 401(k) plan.

But arsenic of 2026, workers successful this property radical volition look a caller income test. If you earned implicit $145,000 successful the erstwhile twelvemonth from your existent employer, your catch-up contributions whitethorn lone beryllium made to a Roth 401(k) plan.

The quality betwixt a modular 401(k) and a Roth 401(k) is the taxation treatment. Workers tin lend pre-tax income to a modular 401(k), which allows them to assertion contributions arsenic a deduction connected their taxation returns. A Roth 401(k), meanwhile, is designed for after-tax income, which means you bash not bask the taxation deduction connected contributions.

Put simply, this caller regularisation adds an upfront taxation load for high-income earners (1).

This seemingly tiny alteration tin person large consequences for galore workers. Just nether 1 successful 5 radical betwixt the ages of 45 and 54 gain implicit $100,000 a year, according to YouGov, truthful millions of radical could beryllium impacted by this caller regularisation (2).

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If you judge this regularisation alteration mightiness interaction you, the archetypal measurement is to scope retired to your leader and inquire if they connection a Roth 401(k) program for employees.

Nearly 93% of employers connection a Roth 401(k) plan, according to the Plan Sponsor Council of America, but determination is simply a accidental your leader is portion of the remaining 7% (3).