Get ready for the Roth catch-up requirement: What plan sponsors should know for 2026
Taxes
- Extending the Tax Cuts and Jobs Act (TCJA) will likely be a top priority.
- The estimated cost of extending the tax cuts is projected at $4.6 trillion
- This could increase the scrutiny on tax-deferred retirement savings provisions to help pay for the cuts.
Social Security
- Many question the future of Social Security benefits.
- Much of the concern stems from misunderstanding how Social Security is funded.
Let’s dispel some common myths in the article: Myths vs. Facts: The state of Social Security.
SECURE Act 2.0 corrections
- Industry efforts are underway to tie up some loose ends within the most recent retirement legislations
- Deem terminal illness as a new distribution trigger
- Clarification on existing plans and retaining grandfather status when joining a MEP/PEP*
- Clarification on if student loan repayment match includes catch-up limits
*Multiple employer plan (MEP), pooled employer plan (PEP)
Anticipated retirement legislation
- Future reforms could simplify and expand retirement plan options such as:
- Incentives for small employers
- Roth IRA to 401(k) rollovers
- Cash balance plans
- Anticipated regulatory shifts on the DOL fiduciary ruling may occur.
- Likely to propose a new version of the ESG ruling limiting fiduciaries’ ability to prioritize environmental, social, and governance (ESG) factors.
- Worker classification rule could be retooled.
Stay on top of the most recent retirement policy and legislation
Connect with Director of Policy at Principal Financial Group