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Ask the Experts July 2, 2024
How Do the SECURE 2.0 Age 60-63 Catch-Up Contributions Work?
Experts from Groom Law Group and CAPTRUST answer questions concerning retirement plan administration and regulations.
Reported by PS
Q: Is the new age 60-63 catch-up election under the SECURE 2.0 Act of 2022 mandatory?
Kimberly Boberg, Kelly Geloneck, Emily Gerard and David Levine, with Groom Law Group, and Michael A. Webb, senior financial adviser at CAPTRUST, answer:
A: No. For readers who might not be aware, under Internal Revenue Code Section 414(v), active participants age 50 or older are permitted to make catch-up contributions above the elective deferral limit. The SECURE 2.0 Act of 2022 added a new provision raising the catch-up contribution limit for active participants aged 60 through 63.
Under this new provision, effective for the 2025 tax year, active participants aged 60 through 63 can contribute the greater of $10,000 or 150% of the 2024 catch-up contribution limit (indexed). This SECURE 2.0 provision is merely an amendment to Code Section 414(v); since the current age-50 catch-up election is not mandatory, the age 60-63 catch-up election is not mandatory either.
However, it remains unclear whether employers with multiple plans in their controlled group must offer the age 60-63 catch-up election or can make it available on a plan-by-plan basis.
NOTE: This feature is to provide general information only, does not constitute legal advice and cannot be used or substituted for legal or tax advice.
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