The Department of Administration, Division of Retirement and Benefits (Division), is working to update the Retirement System IRS Compliance Policy.
This update to is intended to maintain compliance with IRC 401(a) where the Secure Act 2.0 stated: Starting January 1, 2026, if you earn over $145,000 in FICA compensation for 2025 and decide to make catch-up contributions, they MUST be made as Roth contributions. This is a result of SECURE Act 2.0 legislation.
Secure 2.0 Law
- Section 603
Catch up contributions to Section 401(a) qualified plans, Section 403(b) plans, and governmental Section 457(b) plans must be made to on a Roth basis, except for eligible participants whose prior year wages do not exceed $145,000 (indexed for inflation).
- Financial Impacts
None/Minimal impact to the Plan(s), Employers, or of the State of Alaska Retirement Plans. Financial impacts to those who meet eligibility could be minimal to substantial. Each person will be different.
- Member Impacts
Eligible participants are subject to the requirements of section 414(v)(7)(A), then any catch-up contributions that are made to the plan on behalf of the participant must be designated as Roth contributions. However, if an eligible participant is not subject to the requirements of section 414(v)(7)(A), then any catch-up contributions that are made to the plan on behalf of the participant are not required to be designated as Roth contributions. In that case, any catch-up contributions under section 414(v) that are made to the plan on behalf of the participant that are not designated as Roth contributions are not includible in the participant’s gross income under section 402(g)(1)(A) (and do not exceed the limitation in section 457(b)(2)) because, in accordance with section 414(v)(3)(A)(i), the limitations on elective deferrals under sections 401(a)(30) and 403(b) (and the limitation on deferrals under section 457(b)(2)) do not apply to those catch-up contributions.
Proposed Updates
Sections to be updated or added to the Retirement System IRS Compliance Policy
- State of Alaska Deferred Compensation Plan
You may comment on the proposed updates by submitting written comments:
- By Mail:
Division of Retirement and Benefits
P.O. Box 110203, Juneau, AK 99801-0203 - By Fax: (907) 465-3086
- By Email: laura.cordero@alaska.gov
All comments must be received no later than 4:30 p.m. AKST on November 28, 2025.
A copy of the proposed updates is available on the Division’s website. You can also request a copy by contacting laura.cordero@alaska.gov, or by mail via the address provided above.
After the public comment period ends, the Division of Retirement and Benefits will adopt the proposed changes or other provisions dealing with the same subject, without further notice, or decide to take no action. If your interests could be affected, it is recommended you provide comments within the allotted time period.
Written comments received are public records and are subject to public inspection. All questions will be posted to our website where we will provide responses and Frequently Asked Questions.
Statutory authority: AS 39.45, 14.25.003 and 14.25.004.
Fiscal information: The proposed updates are not expected to require increased appropriation.
The Division of Retirement and Benefits keeps a list of individuals and organizations interested in updates. Those on the list will automatically be sent a copy of all the Division of Retirement and Benefits notices of proposed updates. To be added to or removed from the list, please provide your name, and either your email address or mailing address, as you prefer, for receiving notices to:
Division of Retirement and Benefits
P.O. Box 110203,
Juneau, AK 99811-0203.