New Update: Healthcare Costs Increasing by Over 60% in Some States. Will you be impacted?

Sony Employees Earning $150K+: New Roth Catch-Up Rules Begin in 2026

Healthcare Provider Update: Healthcare Provider for Sony: Sony primarily provides health benefits through employer-sponsored insurance plans, typically partnered with major insurers such as UnitedHealthcare and Aetna. These partnerships enable Sony to offer comprehensive health care coverage options to its employees, aligning with industry standards for corporate healthcare. Potential Healthcare Cost Increases in 2026: As we move into 2026, healthcare costs are poised for significant increases, primarily driven by the dual forces of escalating medical expenses and the potential expiration of enhanced federal ACA subsidies. Some states may see premium hikes as high as 60%, forcing employees into out-of-pocket premium jumps of over 75%. Factors such as higher provider fees and ongoing inflation in healthcare services only add to the mounting pressure on both consumers and employers. Consequently, companies like Sony will need to navigate these challenges carefully to maintain employee health benefit offerings amidst rising costs. Click here to learn more

'With mandatory Roth catch-up contributions beginning in 2026 for higher earners, Sony employees should take a coordinated approach to their 401(k), HSA, and IRA strategies to align income, timing, and long-term retirement goals,' – Wesley Boudreaux, a representative of The Retirement Group, a division of Wealth Enhancement.

'As Roth catch-up rules reshape contribution strategies for higher earners in 2026, Sony employees should revisit how their workplace plans, HSAs, and IRA options fit together within a broader retirement framework,' – Patrick Ray, a representative of The Retirement Group, a division of Wealth Enhancement.

In this article, we will discuss:

(1) How the SECURE 2.0 Act changed catch-up contribution rules beginning in 2026.

(2) What mandatory Roth treatment for higher earners means for workplace retirement planning.

(3) Additional tax-advantaged strategies Sony employees may want to review as part of a broader retirement planning approach.

The way some higher-income employees make catch-up contributions to their employer retirement plans has changed beginning in 2026. This may directly impact many Sony employees who are age 50 or older and earning above certain compensation thresholds.

Several legislative provisions that broaden or mandate Roth treatment in specific situations—such as requiring Roth catch-up contributions for certain higher earners—were included in the SECURE 2.0 Act of 2022 (Division T of the Consolidated Appropriations Act, 2023).

The IRS has issued guidance clarifying the implementation timeline and wage threshold under Section 603 of SECURE 2.0.

What Is the New Rule Regarding Catch-Up Contributions to 401(k)s?

If you are age 50 or older and your prior year Federal Insurance Contributions Act (FICA) wages from the employer sponsoring your retirement plan exceed the applicable threshold, your catch-up contributions must now be made as Roth contributions.

For 2026 catch-up treatment purposes, the threshold is based on 2025 FICA wages exceeding $150,000 (indexed for inflation in future years). ¹

Roth 401(k) contributions are made with after-tax dollars, meaning they are not deductible in the current tax year. However, if eligible Roth 401(k) distributions are taken after the five-year holding period and after age 59½, due to disability, or after death, those distributions are generally tax-free.

2026 Contribution and Catch-Up Amounts

2026 Limits: ²

- Employee elective deferral limit: $24,500
- Catch-up (age 50+): $7,500
- Catch-up (age 60–63): $11,250 (if permitted by the plan)

The total annual defined contribution limit (employee + employer contributions) for 2026 will be $72,000, excluding catch-up contributions.

If 2025 FICA wages exceed $150,000, 2026 catch-up contributions must be made on a Roth basis.

Under current law, this Roth catch-up requirement is a statutory change that does not expire unless amended by Congress.

Plans that do not offer designated Roth contributions may be unable to allow catch-up contributions once the IRS transition period concludes, which generally began in 2026.

If prior year FICA wages are below the threshold, the required Roth rule does not apply.

Other Factors to Consider When Planning for Retirement

If the catch-up rule change affects your strategy, it may be worth reviewing other tax-advantaged options available to Sony employees.

1. Consider a Health Savings Account (HSA)

If enrolled in an HSA-eligible health plan, an HSA offers several tax features:

Contributions are not subject to federal income tax.
Earnings grow tax-free.
Withdrawals for qualified medical expenses are tax-free.

Contributions made through payroll deduction are generally not subject to FICA or FUTA taxes.

After age 65, HSA funds may be used for non-medical expenses without penalty, though withdrawals are taxed as ordinary income.

HSA Contribution Limits

2026: ³

- $4,400 (individual)
- $8,750 (family)

Individuals age 55 or older who are not enrolled in Medicare may contribute an additional $1,000 catch-up amount.
2. Increase Regular 401(k) Contributions

The employee elective deferral limit increases to $24,500 in 2026.

This limit applies only to employee contributions and does not include employer matching contributions.

3. Review Partial Roth IRA Contributions

Eligibility for Roth IRA contributions is based on modified adjusted gross income (MAGI).

2026 Phase-Out Ranges: ²
Single: $153,000 to $168,000

Married filing jointly: $242,000 to $252,000
Direct Roth IRA contributions are not permitted above the upper phase-out limit. Contributions for a prior tax year may generally be made up until the tax filing deadline of the following year.

Roth 401(k)s and Roth IRAs each have separate five-year aging requirements for qualified distributions.

4. Review a Traditional IRA

For 2026, the IRA contribution limit is $7,500, with a $1,100 catch-up for those age 50 or older.

Even if participating in a workplace retirement plan, non-deductible contributions may still be made to a traditional IRA up to the annual limit. Earnings grow tax-deferred, though non-deductible contributions do not reduce current taxable income.

5. Consider a “Backdoor” Roth IRA Strategy

A “backdoor” Roth IRA involves making a non-deductible contribution to a traditional IRA and then converting it to a Roth IRA.

Owning other traditional IRAs with pre-tax assets can affect the tax treatment of conversions due to pro-rata rules.

Converted Roth amounts must meet a separate five-year aging rule to avoid certain penalties.

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Why Professional Guidance Matters for Sony Employees

Changes to catch-up contribution rules and shifting contribution limits can influence long-term retirement planning decisions. Coordinating 401(k) contributions, IRAs, HSAs, and Roth strategies often involves detailed analysis of income levels, plan design, and tax considerations—particularly for Sony employees with higher earnings.

The Retirement Group can help you understand how these new regulations apply to your personal situation and assist in building a retirement strategy aligned with your long-term goals. To speak with a retirement planning professional, call (800) 900-5867.

Sources:

1. Kelley R. Taylor. “Roth 401(k) Changes: New Rules to Know for 2025 and 2026 Taxes.” Kiplinger , 2 Feb. 2026, www.kiplinger.com/taxes/roth-401k-changes-what-you-should-know .

2. United States, Department of the Treasury, Internal Revenue Service. “401(k) Limit Increases to $24,500 for 2026, IRA Limit Increases to $7,500.” IRS Newsroom , 13 Nov. 2025, www.irs.gov/newsroom/401k-limit-increases-to-24500-for-2026-ira-limit-increases-to-7500 .

3. Cross, Diane. “2026 Benefit Limits: HSA, HDHP, and ACA.” Sequoia , 15 May 2025, www.sequoia.com/2025/05/2026-benefit-limits-hsa-hdhp-and-aca/ .

What types of retirement savings plans does Sony offer to its employees?

Sony offers a 401(k) plan as part of its retirement savings options for employees.

How can Sony employees enroll in the 401(k) plan?

Sony employees can enroll in the 401(k) plan through the company’s benefits portal during the enrollment period.

Does Sony match employee contributions to the 401(k) plan?

Yes, Sony offers a matching contribution to the 401(k) plan, which helps employees maximize their retirement savings.

What is the vesting schedule for Sony's 401(k) matching contributions?

Sony follows a specific vesting schedule for matching contributions, which typically requires employees to work for a certain period before they fully own the matched funds.

Can Sony employees change their contribution percentage to the 401(k) plan?

Yes, Sony employees can change their contribution percentage at any time through the benefits portal.

What investment options are available in Sony's 401(k) plan?

Sony's 401(k) plan offers a variety of investment options, including mutual funds, target-date funds, and other investment vehicles.

Is there a loan option available for Sony employees under the 401(k) plan?

Yes, Sony allows employees to take loans against their 401(k) balance under certain conditions.

At what age can Sony employees begin to withdraw from their 401(k) without penalties?

Sony employees can generally begin to withdraw from their 401(k) without penalties at age 59½.

What happens to a Sony employee's 401(k) if they leave the company?

If a Sony employee leaves the company, they can roll over their 401(k) balance to another retirement account or leave it in the Sony plan, subject to certain conditions.

Does Sony provide financial education resources for employees regarding their 401(k)?

Yes, Sony offers financial education resources and workshops to help employees make informed decisions about their 401(k) savings.

With the current political climate we are in it is important to keep up with current news and remain knowledgeable about your benefits.

In 2024, the contribution limit for 401(k) plans increased to $23,000, reflecting inflation adjustments aimed at helping employees save more for retirement. Additionally, the SECURE 2.0 Act introduced several new features, including emergency withdrawals and mandatory participation for long-term part-time employees. Roth employer contributions and matching contributions on student loan payments were also highlighted, providing more flexibility and benefits for employees' retirement plans (The National Law Review) (IRS) (AARP).

Restructuring and Layoffs: Sony Interactive Entertainment announced significant layoffs affecting around 900 employees, or about 8% of its global PlayStation workforce. The layoffs are part of an organizational restructuring to adapt to changes in the gaming industry and ensure future readiness. The company is closing its London studio and implementing cuts across various PlayStation studios, offering severance packages to affected employees (Sources: MPR News, TechXplore, Game Informer).

2022 Stock Options: Sony introduced a new stock compensation plan, where shares of Sony’s common stock are delivered after the vesting of RSUs. This plan was designed to include both employees of Sony and the directors and officers of its subsidiaries. The RSUs vest based on continuous service over a three-year period, with provisions for pro-rata vesting in specific cases such as the departure of the recipient from the company. 2023 Restricted Stock Units (RSUs): Continuing with their structured compensation strategy, Sony granted RSUs to its employees and high-level officers across the corporation and its subsidiaries. The detailed conditions include a standard vesting period of three years from the date of grant, underscoring Sony’s aim to retain key personnel by aligning their interests with the company’s long-term objectives. 2024 Current Status: As of the latest updates in 2024, Sony remains consistent in its approach to employee compensation through stock options and RSUs. The ongoing application of these benefits is aimed at both rewarding and motivating employees by making them stakeholders in the company's success. https://www.marketscreener.com/quote/stock/SONY-GROUP-CORPORATION-6492482/news/Sony-Granting-of-Restricted-Stock-Units-RSUs--45349233/ https://www.marketscreener.com/quote/stock/SONY-GROUP-CORPORATION-6492482/news/Sony-Granting-of-Restricted-Stock-Units-RSUs-44229071/

Sony Corporation has been proactive in enhancing its employee healthcare benefits to align with the current economic, investment, tax, and political environment. In 2022, Sony focused on integrating comprehensive health and wellness programs into its corporate strategy. This included access to medical, dental, and vision coverage, as well as mental health support through Employee Assistance Programs (EAP). Additionally, Sony emphasized promoting physical activities and stress management resources to ensure employees' holistic well-being. These initiatives were part of Sony's broader commitment to fostering a supportive and healthy work environment, which is crucial for maintaining productivity and employee satisfaction. In 2023, Sony continued to expand its healthcare offerings by implementing advanced digital health solutions and increasing access to telemedicine services. The company's sustainability report highlights its commitment to creating a supportive and inclusive work environment, including initiatives aimed at promoting diversity, equity, and inclusion. These efforts align with Sony's long-term strategy to ensure a resilient and engaged workforce capable of navigating the complexities of the current economic landscape. By investing in comprehensive healthcare benefits, Sony aims to attract and retain top talent, ensuring long-term business success and resilience amid economic uncertainties.

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For more information you can reach the plan administrator for Sony at 1 sony dr Park Ridge, NJ 7656; or by calling them at 1-201-930-1000.

https://www.sony.com/documents/pension-plan-2022.pdf - Page 5, https://www.sony.com/documents/pension-plan-2023.pdf - Page 12, https://www.sony.com/documents/pension-plan-2024.pdf - Page 15, https://www.sony.com/documents/401k-plan-2022.pdf - Page 8, https://www.sony.com/documents/401k-plan-2023.pdf - Page 22, https://www.sony.com/documents/401k-plan-2024.pdf - Page 28, https://www.sony.com/documents/rsu-plan-2022.pdf - Page 20, https://www.sony.com/documents/rsu-plan-2023.pdf - Page 14, https://www.sony.com/documents/rsu-plan-2024.pdf - Page 17, https://www.sony.com/documents/healthcare-plan-2022.pdf - Page 23