Can a 403(b) Be a Roth? Limits, Matching, and Withdrawals

Yes, a 403(b) can be a Roth account if your employer has added a Roth option to the plan. The Roth version accepts salary deferrals that have already been taxed, and qualified withdrawals in retirement come out tax-free, including the investment earnings. For 2026, you can defer up to $24,500 into a Roth 403(b), with additional catch-up amounts depending on your age and years of service.

Whether Your Plan Actually Offers Roth

Federal law authorizes Roth contributions inside a 403(b) through a “qualified Roth contribution program,” which lets employees route some or all of their salary deferrals into an after-tax Roth account instead of the traditional pre-tax account.¹ The 403(b) is specifically listed as an eligible plan.

Your employer has to choose to offer it. Public schools, hospitals, churches, and other tax-exempt organizations that sponsor 403(b) plans can add the Roth feature, but none are required to.² If your plan documents have not been updated to include a Roth account, you are limited to traditional pre-tax deferrals. Check your Summary Plan Description or ask your benefits coordinator.

2026 Contribution Limits

The dollar limits below apply to the combined total of your pre-tax and Roth deferrals, not to each side separately.

Standard Elective Deferral

For 2026, the maximum elective deferral is $24,500, up from $23,500 in 2025.³ That cap covers everything you defer from your paycheck, whether Roth or pre-tax.

Age 50 and Over

If you reach age 50 by the end of 2026, you can add an $8,000 catch-up, bringing your maximum to $32,500.³

Enhanced Catch-Up for Ages 60 Through 63

SECURE 2.0 created a higher catch-up for participants who are 60, 61, 62, or 63. For 2026 the enhanced catch-up is $11,250, replacing the standard $8,000 catch-up during those four years. The maximum employee deferral in that age band is $35,750.³ Once you turn 64, you revert to the standard catch-up.

15-Year Service Catch-Up

If you have worked for the same qualifying employer for at least 15 years, your 403(b) plan may allow up to $3,000 in additional deferrals per year, subject to a $15,000 lifetime cap.⁴ This provision is limited to employees of educational organizations, hospitals, health and welfare service agencies, churches, and church-related organizations. The plan must specifically allow it, and it is applied before the age-based catch-up when calculating your personal limit.

Overall Annual Addition Limit

The total of your deferrals plus any employer contributions to your account in a single year cannot exceed $72,000 for 2026.⁵ Catch-up contributions sit on top of this cap.

Mandatory Roth Catch-Up for Higher Earners

Starting in 2026, if your FICA wages from the plan-sponsoring employer exceeded $145,000 in the prior calendar year, any catch-up contributions you make must go into the Roth account.⁶ You can no longer send them to the pre-tax side. This requirement was originally scheduled for 2024 and delayed to give employers time to update their systems.

The threshold is indexed. For the 2027 tax year (based on 2026 wages), it rises to $155,000.⁶ The rule looks at wages from the employer that sponsors your plan, not total household income, and it applies only to catch-up contributions. If your wages fell below the threshold, you can still choose pre-tax or Roth for the catch-up.

Roth Employer Matching

Matching contributions have traditionally gone into the pre-tax side, taxed on withdrawal. SECURE 2.0 lets plans offer employees the option to receive matching and nonelective employer contributions as Roth contributions instead.⁷ If your plan offers this and you elect it, the matched amount is included in your gross income for the year it goes into the account, so you pay tax on it now instead of later.

A few things to know if you take Roth matching:

Roth employer contributions must be fully vested when made, regardless of the plan’s normal vesting schedule.¹
These contributions are not subject to federal income tax, Social Security, or Medicare withholding at the time they are contributed, even though they count as current income. You may need to adjust your withholding or estimated payments.⁸
Roth employer matching is reported on Form 1099-R for the year allocated to your account, unlike your own Roth deferrals, which are reported on your W-2.⁸

Roth matching is optional for employers. Many plans still match only on a pre-tax basis.

How to Start Roth Deferrals

To begin, you submit a Salary Reduction Agreement through your employer’s HR department or the plan’s third-party administrator.² The form directs your employer to withhold a set dollar amount or percentage from your pay and route it to the Roth account. Some employers use an online HR portal; others require a paper form. Changes usually take effect in the first pay period after the submission deadline.

Once deferrals start, check your next pay stub. The Roth contribution should appear as a post-tax deduction, separate from any pre-tax retirement or insurance withholdings. You can also log into your investment provider’s portal to confirm the money is flowing into the Roth side of the account.

When Withdrawals Come Out Tax-Free

The reason to use a Roth 403(b) is the tax-free withdrawal in retirement, but the distribution has to qualify. Two conditions must both be met:

At least five full tax years must pass from the beginning of the year you first made a Roth contribution to any designated Roth account in the same plan. If your first Roth contribution hits the account in October 2026, the clock starts January 1, 2026, and the five-year period ends December 31, 2030.⁹
You must have reached age 59½, become disabled, or the distribution must be paid to a beneficiary after your death.¹

If you take money out before meeting both conditions, the earnings portion is included in your taxable income and may also face a 10 percent early withdrawal penalty. Your original after-tax contributions always come back tax-free. The first-time homebuyer exception that applies to IRAs does not apply to 403(b) plans.¹⁰

No Lifetime RMDs

Roth accounts inside employer plans, including the 403(b), are exempt from required minimum distributions during the account owner’s lifetime. This change took effect for tax years beginning after 2023 and puts the Roth 403(b) on equal footing with the Roth IRA. You no longer have to take mandatory withdrawals or roll the balance into a Roth IRA to avoid them.¹

Rolling a Roth 403(b) Into a Roth IRA

When you leave the employer or become eligible for an in-service distribution, you can move the Roth 403(b) balance into a Roth IRA. Two methods are available:

A direct rollover sends the money straight to your Roth IRA custodian. Nothing is withheld and no deadline applies.¹¹
An indirect rollover pays you the money. The taxable portion (earnings) is subject to a mandatory 20 percent withholding, and you have 60 days to deposit the full distribution amount, replacing the withheld portion from your own funds, into a Roth IRA to avoid taxes on the earnings.¹¹

The direct rollover avoids the withholding problem, so most people use it.

One timing detail matters. The five-year clock from your Roth 403(b) does not carry over. The Roth IRA runs its own five-year period, measured from the first tax year you contributed to any Roth IRA.⁹ If you already have a Roth IRA that is more than five years old, the rolled-over funds immediately satisfy that requirement. If you do not, consider opening a Roth IRA and making even a small contribution well before you plan to roll over the 403(b) balance so the clock starts running earlier.

1
Office of the Law Revision Counsel. 26 USC 402A – Optional Treatment of Elective Deferrals as Roth Contributions
2
Internal Revenue Service. Retirement Plans FAQs Regarding 403(b) Tax-Sheltered Annuity Plans
3
Internal Revenue Service. 401(k) Limit Increases to $24,500 for 2026, IRA Limit Increases to $7,500
4
Internal Revenue Service. 403(b) Plans – Catch-Up Contributions
5
Internal Revenue Service. Notice 2025-67 – 2026 Amounts Relating to Retirement Plans and IRAs
6
Internal Revenue Service. Internal Revenue Bulletin 2025-40
7
Internal Revenue Service. SECURE 2.0 Act Changes Affect How Businesses Complete Forms W-2
8
Internal Revenue Service. SECURE 2.0 Act Impacts How Businesses Complete Forms W-2
9
Internal Revenue Service. Retirement Plans FAQs on Designated Roth Accounts
10
Internal Revenue Service. Retirement Topics – Exceptions to Tax on Early Distributions
11
Internal Revenue Service. Topic No. 413, Rollovers From Retirement Plans