Should Plans Add In-Plan Roth Conversions Before Roth Catch-ups Begin in 2026?

Q: Our 403(b) plan currently allows for Roth contributions, but not conversions. Our recordkeeper informed us that it may be prudent to add a Roth conversion feature at the present time due to the implementation of mandatory Roth catch-up in 2026. We do have employees who will be affected by the new Roth catch-up requirement. Does adding a Roth conversion feature make sense in light of this new provision?

Kimberly Boberg, Kelly Geloneck, Emily Gerard and David Levine, with Groom Law Group, and Michael A. Webb, senior financial adviser at CAPTRUST, answer:

A: The decision of whether or not to amend your plan to add a Roth conversion feature involves a lot of factors. Beginning in 2026, Roth conversion (or “in-plan Roth rollover”) is one of the options that can be used to correct mandatory Roth catch-up contribution errors. To use the in-plan Roth rollover for correction, you do not need to offer it as a standard feature in your plan. However, if you want the option to use this as a correction method, you must amend your plan document to specifically include it.  As there are specific requirements for, and implications of, using this correction method, it is important to discuss with your plan counsel.

 NOTE: This feature is to provide general information only, does not constitute legal advice and cannot be used or substituted for legal or tax advice.

Do YOU have a question for the Experts? If so, we would love to hear from you! Simply forward your question to Amy.Resnick@issmarketintelligence.com with Subject: Ask the Experts, and the Experts will do their best to answer your question in a future column.