What Every Plan Sponsor Should Know for 2026
- Jordan Cross
- 29 minutes ago
- 3 min read
Key updates and trends shaping Qualified Retirement Plans in the year ahead
Qualified Retirement Plan rules continue to evolve, and 2026 brings several important updates that may affect plan operations, participant experiences, and fiduciary responsibilities. Nearly 80% of plan sponsors have already taken steps to address SECURE 2.0 changes before their effective dates.[1]
Understanding what is required and what is still on the horizon can help position your plan for success in the year ahead.
Key regulatory updates for 2026
Roth catch-up contributions
Under SECURE 2.0, 401(k) catch-up contributions for employees aged 50 and older with FICA Box 3 wages above $150,000 in 2025 must be made on a Roth (after-tax) basis. This rule goes into effect on January 1, 2026.Why it matters: Payroll, administration, and employee communications should be updated to reflect these changes. Clear messaging helps avoid confusion and builds trust with your 50+ year old employees. CrossPlans worked with all clients in Q4 2025 to review their options and circulated both a Roth Catch-up best practices and procedures FAQ as well as a sample notice for your Highly Paid Individuals. Please contact us for examples of these important notices.
Super catch-up contribution limits
Participants between the age of 60 to 63 may be eligible for “super catch-up” 401(k) contributions. For 2026, eligible employees can contribute an additional $11,250 in combination with the standard limit of $24,500 for a total of $35,750. It is important to note that super catch-up contributions are also subject to the new Roth catch-up provision, meaning employees with wages above the threshold will need to make these contributions on a Roth basis.
Why it matters: Staying on top of these annual changes helps keep the plan compliant and supports participants looking to maximize their savings opportunities.
Long-term part-time employee eligibility
Starting in 2025 and continuing into 2026 and beyond, long-term part-time employees who work at least 500 hours for two consecutive years must be allowed to make salary deferrals into the plan. These LTPT participants are not required to receive employer contributions nor be included in most compliance testing, but will be included in participant counts for audit purposes.
Why it matters: Expanding eligibility can boost participation, improve coverage testing, and demonstrate a commitment to inclusion across your workforce.
Cycle 4 plan document restatement
All pre-approved defined contribution plans must be restated in the near future to include recent legislative updates such as SECURE 1.0 and SECURE 2.0.
Why it matters: Restating on time helps your plan documents stay compliant and audit-ready. This process can keep your plan language aligned with current laws and can help prevent costly administrative issues later. CrossPlans anticipates discussing and reviewing Cycle 4 Plan Document changes in Q3 or Q4 of 2026.
Here are two areas to keep on your radar.
1. Retirement income solutions
More plans are exploring ways to support participants as they transition from saving to spending. Examples include updated target date funds and lifetime income options.
Potential impact: These features can help participants manage assets in retirement and reduce rollover leakage, although adoption depends on plan size, demographics, and provider capabilities.
2. Legal and fiduciary developments
Courts and regulators continue to shape fiduciary frameworks. Excessive-fee litigation remains active, and recent rulings have clarified expectations for plan governance and investment oversight.
Potential impact: Staying informed on legal developments helps sponsors strengthen fiduciary processes and reduce exposure to risk.
Start the year strong
The beginning of a new year is the ideal time to get ahead of regulatory deadlines and position your plan for success. By preparing now, you can reduce administrative stress later and give participants a more seamless experience.
As we kick off 2026, the steps you take this quarter will set the tone for the year ahead. Review your plan, update what is needed, and stay ahead of the curve.
We are here to help you evaluate your options and prepare your plan for the future with confidence.
________________________________________
Dana Point, CA
714.210.4164
©401(k) Marketing, LLC. All rights reserved. Proprietary and confidential. Do not copy or distribute outside original intent.
________________________________________