Roth Catchup Deferral Requirement

[Basically]

Just looking for some clarification and confirmation...

The Roth catchup requirement rule is that if you earned $150K of W2 income the previous year then your catchup deferrals must be Roth deferrals.    Is there something that I can show a CPA clarifying reported K1 income?  I googled and found someone saying the rule points strictly to W2 income..

Thanks

[Bri]

But K-1s aren't wages subject to FICA.

[Peter Gulia]

A § 414(v)(7) must-be-Roth constraint applies to “an eligible participant whose wages (as defined in section 3121(a)) for the preceding calendar year from the employer sponsoring the plan exceed[s]” the specified amount.

Internal Revenue Code of 1986 (26 U.S.C.) § 414(v)(7)(A) https://www.govinfo.gov/content/pkg/USCODE-2024-title26/html/USCODE-2024-title26-subtitleA-chap1-subchapD-partI-subpartB-sec414.htm.

And here’s the statute’s cross-reference to I.R.C. § 3121(a) https://www.govinfo.gov/content/pkg/USCODE-2024-title26/html/USCODE-2024-title26-subtitleC-chap21-subchapC-sec3121.htm.

Accord 26 C.F.R. § 1.414(v)-2(a)(2) (“For this purpose, wages taken into account are wages as defined in [Internal Revenue Code] section 3121(a) for purposes of the taxes imposed by sections 3101(a) and 3111(a) for the year the wages are required to be taken into account for purposes of chapter 21 of the Internal Revenue Code.”), https://www.ecfr.gov/current/title-26/part-1/section-1.414(v)-2#p-1.414(v)-2(a)(2).

Further, it’s not necessarily all Form W-2 box 3 wages, but rather those from the employer that maintains the plan for which one applies a § 414(v)(7) constraint about the portion of elective deferrals that must be Roth contributions.

For example, an individual might have three (unrelated) employers that pay her $400,000 in wages, but if no employer paid more than $150,000, a § 414(v)(7) constraint is not invoked.