Configure Payroll for SECURE 2.0 Act

One of the main objectives of SECURE 2.0 Act of 2022 is to make it more attractive for employers to offer retirement plans and improve retirement outcomes for their employees.

This configuration document describes the steps you need to perform to configure HCM Cloud Payroll to comply with these provisions within this Act.

Title and section	Description	Notes
Title I - Section 109	As of January 1, 2025, age-based catch-up limits have been increased for individuals aged 60 to 63 to the greater of: $10,000 50% more than the regular catch-up amount These amounts are adjusted yearly to match the projected cost of living. Note: The US Treasury Department and the IRS are still considering whether to make enforcement of these increased limits required for employers.	These limits are enabled by default once you upgrade your deferred compensation elements using the Feature Upgrade flow. If you aren't currently offering these increased catch-up limits, you can override them through the Calculation Value Definition task. For further info, see Override Deferred Compensation Catch-Up Limits for Ages 60 Through 63 in the Help Center.
Title I – Section 110	As of January 1, 2024, qualified student loan payments can be treated as elective deferrals for the purposes of (employer) matching contributions.	This is optional. For further info, see Configure Employer-Match Contributions for Qualified Student Loan Payments in the Help Center.
Title VI -– Section 603	As of January 1, 2026, all catch-up contributions to qualified retirement plans are subject to Roth tax treatment. Employees are exempt if their compensation in eligible pay is $145,000 or less (indexed) in the prior calendar year.	This is mandatory for payroll processing. For further info, see Eligibility for Pretax Catch-Up Contributions for Deferred Compensation Plans in the Help Center.

Title and section

Description

Notes

Title I - Section 109

As of January 1, 2025, age-based catch-up limits have been increased for individuals aged 60 to 63 to the greater of:

$10,000
50% more than the regular catch-up amount

These amounts are adjusted yearly to match the projected cost of living.

Note:

The US Treasury Department and the IRS are still considering whether to make enforcement of these increased limits required for employers.

These limits are enabled by default once you upgrade your deferred compensation elements using the Feature Upgrade flow.

If you aren't currently offering these increased catch-up limits, you can override them through the Calculation Value Definition task.

For further info, see Override Deferred Compensation Catch-Up Limits for Ages 60 Through 63 in the Help Center.

Title I – Section 110

As of January 1, 2024, qualified student loan payments can be treated as elective deferrals for the purposes of (employer) matching contributions.

This is optional.

For further info, see Configure Employer-Match Contributions for Qualified Student Loan Payments in the Help Center.

Title VI -– Section 603

As of January 1, 2026, all catch-up contributions to qualified retirement plans are subject to Roth tax treatment.

Employees are exempt if their compensation in eligible pay is $145,000 or less (indexed) in the prior calendar year.

This is mandatory for payroll processing.

For further info, see Eligibility for Pretax Catch-Up Contributions for Deferred Compensation Plans in the Help Center.

Note:

Refer to the US legislative announcements and product release notes for the latest info regarding support of additional features of this act.

For further info, see the following.

Secure 2.0 Section by Section Summary on the senate.gov website
H.R.2954 - Securing a Strong Retirement Act of 2021 on the congress.gov website
Notice 2024-2 – Miscellaneous Changes Under the SECURE 2.0 Act of 2002 on IRS.gov website
Notice 2025-00350 – Catch-Up Contributions on federalregister.gov website