The US Department of the Treasury and the Internal Revenue Service have finalized regulations under the SECURE 2.0 Act that change how certain retirement plan participants may make catch-up contributions. Beginning in 2026, participants whose income meets certain thresholds and who are eligible to make catch-up contributions may, in many cases, only be permitted to do so on a Roth (after-tax) basis.
While these rules apply to nearly all defined contribution retirement plans, they raise unique administrative and compliance challenges for multiemployer defined contribution plans, which are those defined contribution plans to which more than one employer is obligated to contribute and which are maintained pursuant to one or more collective bargaining agreements (CBAs). Although the rules include temporary relief for collectively bargained plans, multiemployer plans should begin planning now.
What the Final Regulations Require
The Roth catch-up requirement applies only if all of the following conditions are met:
- The participant is age 50 or older and eligible to make catch-up contributions.
- The plan permits catch-up contributions.
- The participant’s prior-year Social Security (FICA) wages from the applicable employer exceed the statutory threshold (i.e., $150,000 in 2026, and as subsequently indexed).
Participants whose prior-year wages do not exceed the threshold may continue making catch-up contributions on a pre-tax basis, if permitted by the plan.
Special aggregation rules may apply when determining whether the wage threshold is exceeded. For example, wages paid by employers within a controlled group or common paymaster arrangement may need to be aggregated. These rules are complex and beyond the scope of this blog post.
Why Multiemployer Plans Face Unique Challenges
Multiemployer plans face challenges that single-employer plans do not.
Participants often work for multiple participating employers during a year. As a result, no single employer may have complete visibility into an individual’s prior-year wages. In addition, coordination across multiple payroll and recordkeeping systems can make compliance significantly more complicated.
Recognizing these challenges, the final regulations provide temporary delayed applicability relief for multiemployer plans.
These plans are treated as satisfying the Roth catch-up requirement until the first calendar year beginning after the later of December 31, 2026 or the expiration (without regard to extensions) of the last CBA requiring contributions to the plan that was in effect on November 17, 2025.
This relief is temporary. Once it ends, plans must be prepared to identify affected participants and properly administer Roth catch-up contributions across multiple employers and payroll systems.
Action Steps Multiemployer Plans Can Take Now
Although the relief provides additional time, implementation will require careful coordination among boards of trustees, plan professionals, participating employers, payroll providers, and recordkeepers.
Multiemployer plans should consider taking the following steps now:
- Determine the plan’s applicability date: Gather and review CBAs to determine when the plan will no longer be deemed to satisfy the Roth catch-up requirement and when the regulations will apply with respect to the plan.
- Review governing documents: Confirm whether catch-up contributions and Roth contributions are permitted under plan documents and participation agreements.
- Notify participating employers: Notify participating employers of their obligations and the potential consequences of any compliance failures.
- Assess payroll and recordkeeping systems: Work with service providers to assess coordination among payroll and recordkeeping systems to determine whether they can track prior-year FICA wages and administer Roth catch-up contributions.
- Evaluate bargaining implications: Evaluate CBA provisions to identify whether bargaining may be required before implementing changes and confirming expiration dates.
- Develop participant communications: Prepare clear explanations for higher-paid participants whose catch-up contributions may be affected.
- Prepare required amendments and disclosures: Coordinate with service providers and counsel regarding plan amendments, updates to the summary plan description or preparation of a summary of material modification.
Early evaluation can help reduce compliance risk and avoid operational disruption once the requirement becomes effective.
Looking Ahead
The Roth catch-up rules represent a significant operational shift for multiemployer plans that rely on coordination across multiple employers and bargaining relationships. Although temporary relief provides additional time, plans should begin evaluating now when the requirement will apply and what operational changes will be necessary to ensure compliance and how compliance risks may be mitigated.
For more information, or if you need help evaluating when these rules will apply to your plan and how you can best address compliance challenges, please contact the authors of this blog or your Morgan Lewis contacts.