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Bill

SB 7010

Roth Contribution Plans in Deferred Compensation Programs

2026 Regular Session

Florida allows public employees to make after-tax Roth contributions to deferred compensation plans, enabling tax-free retirement withdrawals.

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Bill Summary · SB 7010

Legislative bill overview

SB 7010 permits Florida municipalities and other public employers to offer Roth contribution options within their deferred compensation programs (commonly known as 457 plans). This allows public employees to make after-tax contributions that grow tax-free and can be withdrawn tax-free in retirement, complementing traditional pre-tax deferral options already available.

Why is this important

Public employees gain greater flexibility in retirement savings strategy by choosing between tax deductions now (traditional) or tax-free withdrawals later (Roth), allowing them to optimize based on expected retirement tax brackets. This modernizes Florida's public sector benefits to align with options available to private sector workers and federal employees, potentially improving long-term retirement security.

Potential points of contention

  • Revenue impact: Tax-free Roth withdrawals reduce future state tax revenue compared to traditional deferrals, though this is offset by current after-tax contributions
  • Administrative complexity: Public employers must implement systems to track Roth versus traditional contributions separately and manage different withdrawal rules
  • Equity considerations: Roth benefits disproportionately favor higher-income employees who can afford after-tax contributions, while providing limited value to lower-wage workers

Compiled from official sources — confirm details with the bill’s official record.

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