Notice to Participants about Roth Catch-up in 2024

[austin3515]

Anyone have a sample notice they have seen / prepared that they are willing to share?  I assume some of the big providers have put something together...

[Towanda]

I was working on something for our employers without Roth, and a notice for employees.  I've had plenty of clients ask me about it.  Then things came to a screeching halt in a little company meeting last week.

There is apparently an increasing push by powerful players to delay the Roth-ification of catch-up because payroll and recordkeeping systems aren't prepared to accommodate it by January 1, 2024.  And there's also that niggling argument that catch-up, in general, will be disallowed effective in 2024 due to the technical error in the SECURE 2.0 language . . . So, as seems to be the case with all things SECURE, we're "waiting for guidance."  Sigh. 

We are sitting tight for the moment.

 

[austin3515]

I heard the same but I don't see how it is even possible since this is how they paid for the entire bill. 

[Paul I]

You may find this survey conducted by the PSCA about preparedness for implementation of the Roth Catch-Up provision:

 

Roth catch-up status.pdf

[Peter Gulia]

Congress’s repeal before the statute’s applicability date seems unlikely. Among many reasons, the Joint Committee on Taxation estimated the revenue raised by SECURE 2022’s § 603 as $16.637 billion for fiscal years 2024-2032.

A July 19 letter asks the Treasury department for “transition relief.” In context and by implication, the letter asks for a year’s nonenforcement.

If the Internal Revenue Service declines to apply Internal Revenue Code of 1986 § 414(v)(7), it’s doubtful any taxpayer has constitutional standing to seek a court’s order commanding the IRS to enforce § 414(v)(7).

I don’t guess anything about whether the Treasury department might openly declare, or quietly set, a nonenforcement policy.

[RatherBeGolfing]

12 hours ago, Peter Gulia said:

Congress’s repeal before the statute’s applicability date seems unlikely. Among many reasons, the Joint Committee on Taxation estimated the revenue raised by SECURE 2022’s § 603 as $16.637 billion for fiscal years 2024-2032.

I put it more in "pipe dream" territory than unlikely...

12 hours ago, Peter Gulia said:

I don’t guess anything about whether the Treasury department might openly declare, or quietly set, a nonenforcement policy.

I'll guess 🤔.  I think this is a big enough issue that they have to provide something that practitioners can rely on, even if its just a notice of nonenforcement.