How many participants are burdened by the condition that a catch-up deferral must be a Roth contribution?

For 2026, Internal Revenue Code § 414(v)(7) burdens only a participant who:

had, from the employer that maintains the plan, 2025 Social Security wages (not counting self-employment income as a partner or member) more than $150,000 [$145,000 inflation-adjusted]; and

is (or by the end of 2026 will be) 50 or older; and

might need an age-based catch-up to support her deferrals.

For your typical client plan, how many people is this?

FWIW... I heard on an NPR news report the other night that about 8% of employees in the US make more than $145K/year.

Here’s what I’m seeing:

A small business might have a few nonowner managers subject to § 414(v)(7).

For many law firms, § 414(v)(7) doesn’t burden the associates (because they’re not age 49), doesn’t burden the partners (if they’re self-employed individuals), and might burden a nonpartner senior counsel (but most of these are younger than 49). Section 414(v)(7) burdens those of the nonlawyer assistants who are 49 or older.

For a university, § 414(v)(7) burdens those in the faculty or administration who are 49 or older.

For a governmental employer, § 414(v)(7) tends to affect department heads.

For a big financial-services business, § 414(v)(7) can affect thousands of participants.

Of course, what I’m seeing might not reflect workforces as a whole.

You are going to need to define burden a bit better. Affects would be a better term since it's hard to see some who is able to afford to defer more than $23K into a retirement account as being burdened that their deferral beyond be designated ROTH and the future earnings on that not subject to income taxation.

I meant burdened only in the sense of § 414(v)(7) depriving an individual of what otherwise might be her choice between Roth and non-Roth deferrals.

(While I might share your view that many participants ought to prefer Roth for all or some of one’s deferrals, there are situations in which choosing non-Roth can be reasoned financial planning.)

Anyhow, I wasn’t thinking about any individual’s preference, only whether § 414(v)(7) restrains a participant’s choice for the catch-up portion of a deferral.

And “affected” is the language I advised for communications about the soon-to-be-applied tax law.

I just did an analysis on our largest plan in terms of employee count using 2024 census data to determine who might be potentially affected. For this plan it ended up being about 8% of the employees (like Artie heard).  It seems that what the hard part and sticking point for the employers are that there is another "type" of employee in addition to HCEs, Keys and NHCEs with a completely different compensation determination than regular plan compensation or statutory compensation.