Beginning in 2025, participants over the age of 50 can elect their catch-up contributions as either Traditional (this has always been allowed) or Roth (this is new). Along with that, there are new rules. See below:
The excerpt above is from Catch-Up Contributions 2025 and 2026: A Guide | Charles Schwab, feel free to read this/pass it along to participants.
Will HPIs have to elect their catch-ups as Roth? No, they will be auto deemed unless they opt out of this.
What if they were supposed to do Roth catch-ups but weren't caught? They can correct in 3 ways:
- Correction via W2 (TTC would handle)
- In-plan Roth rollover (if plan allows for in-plan Roth conversions)
- TTC refunds their catch-ups to them
Additionally, the attachments are being sent to our clients to pass along to participants. If we get questions, please refer to these attachments.