The Internal Revenue Service (IRS) released guidance last Friday addressing Section 603 of the SECURE 2.0 Act which deals with Roth catch-up contributions.

Section 603 mandates that catch-up contributions must be Roth for those earning more than $145,000. The IRS’ guidance grants a two-year delay in the provision’s effective date. Catch-up contributions can now be made on a pre-tax basis through 2025, regardless of income.

The guidance text states that “the first two taxable years beginning after December 31, 2023, will be regarded as an administrative transition period with respect to the requirement under section 414(v)(7)(A) of the Code that catch-up contributions made on behalf of certain eligible participants be designated as Roth contributions.”1