RMD Age Now 73 (Mandatory)

The age to start taking an RMD from a Traditional IRA is 73. An RMD is required from a 401(k) or 403(b) plan at the later of April 1 of the year you turn 73 or the year you retire.

In 2033, the RMD age will increase to 75.

RMD Penalty (Mandatory)

The penalty for not taking an RMD is 25%. However, as a service to members, GuideStone automatically distributes RMDs from 403(b) or 401(k) accounts.

RMDs on Roth Employer-sponsored Accounts (Mandatory)

Effective January 1, 2024, RMDs on Roth-designated accounts in an employer-sponsored plan (401(k) or 403(b) plans) will not be required.

RMDs for Surviving Spouses (Mandatory)

Effective January 1, 2024, spousal beneficiaries can elect to treat an inherited 403(b) or 401(k) as their own for RMD purposes.

Catch-up Limit Increase (Mandatory)

Effective January 1, 2025, employees ages 60–63 will be able to make catch-up contributions up to the greater of $11,250 for 2025 (indexed). This is 50% more than the regular catch-up amount.

Qualified Disaster Recovery Distributions (Optional)

If permitted in the 403(b) or 401(k) plan, a qualified federally declared disaster distributions of up to $22,000 will be available for an eligible employee.

Penalty-free Distributions (Optional)

• If permitted in the 403(b) or 401(k) plan, employees with a terminal illness, as determined by a physician, can avoid the 10% early distribution penalty.
• If permitted in the 403(b) or 401(k) plan, victims of domestic abuse can withdraw up to $10,000 (indexed) or 50% of their account balance and avoid the 10% early distribution penalty.
• Effective January 1, 2026, employees can receive up to $2,500 per year (indexed) from their retirement account when the distributions are used for payment of long-term care insurance premiums if permitted in the plan. These distributions are exempt from the 10% early distribution penalty.

Roth Catch-up Contributions for High Earners (Mandatory)

Effective January 1, 2026, if employees with wages exceeding $145,000 (indexed) in the prior year make catch-up contributions to a 403(b) or 401(k) plan, these catch-up contributions must be designated as Roth contributions.

The IRS has not issued guidance on this, but you should begin working with payroll providers before January 1, 2026, to ensure that your payroll system is ready to accommodate these changes.

Employer Roth Contributions (Optional)

If permitted in the 403(b) or 401(k) plan, employees can elect to receive employer contributions (either matching and/or non-matching) as a Roth contribution. Employees must be fully vested to receive employer Roth contributions.

Student Loan Employer-matching (Optional)

If permitted in the 403(b) or 401(k) plan, employees may receive employer-matching contributions on qualified student loan payments.

Automatic Enrollment for New 401(k) and 403(b) ERISA Plans (Mandatory)

Beginning in 2025, new ERISA plans must provide automatic enrollment provisions for their employees. This does not apply to church plans. View our Guide for ERISA Plans for more ERISA-specific SECURE 2.0 provisions.