hard · Certified Financial Planner General Principles
The Keene family owns a small business. A 55-year-old employee, who earned $170,000 in 2025 and is not a 5% owner, wishes to make a catch-up contribution to the company's 401(k) plan in 2026.
Based on the 2026 Parameter Lock and SECURE 2.0, which statement is correct?
- The employee is eligible for the enhanced catch-up of $11,250 because they are over age 50.
- The employee must make the 8,000 catch-up contribution to a Roth account because their 2025 compensation exceeded150,000.
- The employee may contribute an $8,000 catch-up on a pre-tax basis.
- The employee is prohibited from making any catch-up contributions because they are classified as a Highly Compensated Employee (HCE).
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