Top 3 retirement planning changes in 2026
WASHINGTON (TNND) — Planning to retire in 2026 or saving for retirement in the near future?
With the One Big Beautiful Bill and retirement legislation called Secure 2.0, the new year has more than just inflation adjustments.
Here are three changes being made in 2026.
1) Roth-only catch-up contributions for high-income 401(k) earners
High-income earners (making $150,000 or more in FICA income in a previous year) over age 50 and investing in 401(k) or other company retirement plans must make catch-up contributions to their plans’ Roth option instead of tax-deferred contributions starting this year.
This change is a result of a provision in the Secure 2.0 retirement legislation.
In 2026, 401(k) participants under age 50 can contribute $24,500 to company plans. If they are over 50, they can add another $8,000 in catch-up contributions for a total of $32,500. People ages 60-63 can also make contributions of an extra $11,250 on top of the $24,500, known as a “super-catch-up” contribution.
To note: Some 401(k) plans may not have a Roth option. These participants can instead consider making a full IRA contribution in addition to the baseline 401(k) contributions ($24,500). In 2026, the IRA contribution limit is $8,600 for people over 50 and $7,500 for people under 50. Those able to invest more than that can consider a taxable brokerage account.
However, some are wondering how 401(k) investors proceed if they wish to make the traditional tax-deferred contributions over the Roth option. The Secure 2.0 legislation forced higher-income and older workers to use the Roth option for the catch-up contributions. But workers can contribute the base limit to the traditional option, while directing the catch-up contributions to Roth.
2) Higher SALT deduction amounts
Taxpayers are now able to deduct a higher amount of state and local taxes as a result of the One Big Beautiful Bill.
In 2025, the SALT deduction cap was increased to $40,000 from $10,000. It will revert to $10,000 in 2030.
How does SALT relate to retirement?
The amount of SALT that is deductible phases out for higher-income taxpayers (people with modified adjusted gross incomes over $500,000). High-income earners must consider how to come in under $500,000 if they are close. They could favor contributions to traditional tax-deferred plans over the Roth option or max out health savings accounts.
3) Senior deductions
Starting this year and through 2028, those aged 65 are eligible for a new $6,000 deduction, which doubles to $12,000 for married couples filing jointly (if both are 65 or older). For those who don’t itemize, the new deduction will stack on top of standard deductions.
Here is a breakdown of the deductions for 2026:
- Single filers (standard deduction): $16,100
- Single filers over 65: $16,100+ $2,050 + $6,000 = $24,150
- Married couples filing jointly (standard deduction): $32,200
- Married couples over 65 filing jointly: $32,200 + $1,650×2 + $6,000×2 = $47,500
High-income seniors should also take note that income limits apply. The deduction is reduced for single filers with modified adjusted gross incomes over $75,000, as well as married couples filing jointly with MAGI over $150,000. The deduction goes away for singles with MAGI over $175,000 and married couples filing jointly with MAGI of $250,000 or more.
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The Associated Press and Morningstar’s Christine Benz contributed to this report.