- My Forums
- Tiger Rant
- LSU Recruiting
- SEC Rant
- Saints Talk
- Pelicans Talk
- More Sports Board
- Coaching Changes
- Fantasy Sports
- Golf Board
- Soccer Board
- O-T Lounge
- Tech Board
- Home/Garden Board
- Outdoor Board
- Health/Fitness Board
- Movie/TV Board
- Book Board
- Music Board
- Political Talk
- Money Talk
- Fark Board
- Gaming Board
- Travel Board
- Food/Drink Board
- Ticket Exchange
- TD Help Board
Customize My Forums- View All Forums
- Show Left Links
- Topic Sort Options
- Trending Topics
- Recent Topics
- Active Topics
Started By
Message
I have a really dumb question about my company's 401k contribution
Posted on 7/20/23 at 12:45 pm
Posted on 7/20/23 at 12:45 pm
I've never seen contributions referred to as "Employee Deferral" and "Roth Deferral" and I can't find definitions for these on the Fidelity site. Here is what it shows for contributions:
I assume Employee deferral is pre-tax and Roth Deferral is after tax, but am I missing something here? I don't qualify to contribute to a roth to my knowledge due to my income, so is this somehow different than that?
It also has an option to input a desired election amount, but limits it to $15,000 for both Employee and Roth. Why? Shouldn't it be whatever the current 401k limit and Roth limits are (i.e. 22,500 and 6,500)?
I'm clearly not literate when it comes to this stuff and thought I'd get anonymous feedback here before I made myself look like an idiot to my HR benefit manager or someone at Fidelity.
I assume Employee deferral is pre-tax and Roth Deferral is after tax, but am I missing something here? I don't qualify to contribute to a roth to my knowledge due to my income, so is this somehow different than that?
It also has an option to input a desired election amount, but limits it to $15,000 for both Employee and Roth. Why? Shouldn't it be whatever the current 401k limit and Roth limits are (i.e. 22,500 and 6,500)?
I'm clearly not literate when it comes to this stuff and thought I'd get anonymous feedback here before I made myself look like an idiot to my HR benefit manager or someone at Fidelity.
6
Posted on 7/20/23 at 1:11 pm to frankthetank
quote:
I don't qualify to contribute to a roth to my knowledge due to my income
Roth IRA, maybe.. but you can use the Roth provision in your 401(k).
You’re confusing IRA and 401(k) rules.
Posted on 7/20/23 at 1:13 pm to frankthetank
as previous poster stated, Roth 401k and Roth IRA are not the same thing.
Posted on 7/20/23 at 1:23 pm to frankthetank
quote:
It also has an option to input a desired election amount, but limits it to $15,000 for both Employee and Roth. Why? Shouldn't it be whatever the current 401k limit and Roth limits are (i.e. 22,500 and 6,500)?
The Roth deferral question has already been answered, so I’ll answer this one.
My suspicion is that these are per pay period deferral options, hence the $15,000 limit being arbitrary and not aligning with the annual rules. Also, the Roth 401k and traditional 401k have the same annual limit of $22,500 for employee deferrals.
Posted on 7/20/23 at 1:29 pm to frankthetank
quote:
I'd get anonymous feedback here before I made myself look like an idiot to my HR benefit manager or someone at Fidelity.
Don’t even go to HR, go straight to Fidelity.
At least for my company, Fidelity support is incredibly knowledgeable and helpful, often knowing more than our internal benefits team
I wouldn’t feel bad or embarrassed to call them about these questions.
Posted on 7/20/23 at 2:07 pm to slackster
Thanks guys. I didn't even realize there was a difference between Roth IRA and Roth 401k. So does the contribution limit of 22,500 apply to the total amount contributed to both accounts (Employee and Roth deferral) or can I contribute the max to each?
Posted on 7/20/23 at 6:48 pm to frankthetank
Total to all 401(k) whether Roth or Pre-tax 
Posted on 7/20/23 at 10:01 pm to frankthetank
You and employer can contribute up to a maximum of $66k combined to an employer sponsored plan.
That is the limit
That is the limit
Posted on 7/20/23 at 10:32 pm to frankthetank
quote:
I don't qualify to contribute to a roth to my knowledge
In addition to Roth 401k you can fund a Roth IRA even if over income limit using "Backdoor Roth" (look it up). You can do a spouse Roth IRA too if married whether or not they have income. Dont let income limit dissuade you. (If you have an existing traditional IRA there'd be some additional taxes due to pro-rata rule)
Posted on 7/21/23 at 3:56 am to frankthetank
I’m assuming it’s per pay period, hence the arbitrary max of 15k vs the yearly max amount of 22.5k.
Posted on 7/21/23 at 7:52 am to masoncj
quote:
You and employer can contribute up to a maximum of $66k combined to an employer sponsored plan. That is the limit
Yes, but you only can contribute $22,500 yourself as an employee, disregarding catch ups.
This post was edited on 7/21/23 at 7:53 am
Posted on 7/21/23 at 9:25 am to slackster
Ya the overall limit that 99% of employees don't get just confuses people.
Posted on 7/21/23 at 5:16 pm to slackster
“Yes, but you only can contribute $22,500 yourself as an employee, disregarding catch ups.”
That is just for for 401k , you still can can contribute to Roth 401k as well.
Again the max is $66k for any employee sponsored plan.
I bumped up against this the past two years
Last year it $60k I believe
This year they bumped it up to $66k
That is just for for 401k , you still can can contribute to Roth 401k as well.
Again the max is $66k for any employee sponsored plan.
I bumped up against this the past two years
Last year it $60k I believe
This year they bumped it up to $66k
Posted on 7/21/23 at 8:42 pm to masoncj
quote:
Yes, but you only can contribute $22,500 yourself as an employee, disregarding catch ups.”
That is just for for 401k , you still can can contribute to Roth 401k as well.
You can only contribute with employee contributions up to $22,500 total. You cannot contribute $22,500 to the 401k and then $22,500 to the ROTH 401k.
For example, someone could do $11,250 in 401k and $11,250 in ROTH 401k ($22,500 total) but not $12,000 in each ($24,000).
Similarly, if you contribute $11,250 and change jobs, then contribute over $11,250 in your new job in the same calendar year, that is illegal and you'll have to unwind that transaction.
And maybe 1% of workers get employer contributions to the max cap, and in any event,it's immaterial to the OP's question since he can't do anything about that. He can only control what he contributes.
This post was edited on 7/21/23 at 8:59 pm
Posted on 7/21/23 at 8:53 pm to Teddy Ruxpin
Teddy
You’re Simply wrong on this I just fricking told you, I already did this in 2022 and have already this year as well.
To be precise for this year I have contributed $46200 to my employer account and they have given me $19800 for a grand total of $66k
To be clear I am not talking about the max taxable benefit …Simply the max contributions (total dollars) allowable by law.
LINK
You’re Simply wrong on this I just fricking told you, I already did this in 2022 and have already this year as well.
To be precise for this year I have contributed $46200 to my employer account and they have given me $19800 for a grand total of $66k
To be clear I am not talking about the max taxable benefit …Simply the max contributions (total dollars) allowable by law.
LINK
This post was edited on 7/21/23 at 8:57 pm
Posted on 7/21/23 at 9:03 pm to masoncj
quote:
This limitation is by individual, rather than by plan. You can split your annual elective deferrals between designated Roth contributions and traditional pre-tax contributions, but your combined contributions can’t exceed the deferral limit - $22,500 in 2023; $20,500 in 2022; $19,500 in 2021 ($30,000 in 2023; $27,000 in 2022; $26,000 in 2021 if you're eligible for catch-up contributions).
Don't get mad at me, take it up with the IRS.
Posted on 7/21/23 at 9:15 pm to Teddy Ruxpin
I’m not mad at you
401(k) contribution limit for 2023 $22,500 $66,000
Source IRS
Look at the matrix in the link I provided
“ If you reach the maximum that you can contribute to your 401(k) as an employee, you may be able to save more for retirement in your workplace plan through after-tax contributions. That means that while your after-tax contributions have the potential to benefit investment growth while they're in your 401(k) account, you may still have to pay taxes again on that money when you withdraw funds in retirement.”
401(k) contribution limit for 2023 $22,500 $66,000
Source IRS
Look at the matrix in the link I provided
“ If you reach the maximum that you can contribute to your 401(k) as an employee, you may be able to save more for retirement in your workplace plan through after-tax contributions. That means that while your after-tax contributions have the potential to benefit investment growth while they're in your 401(k) account, you may still have to pay taxes again on that money when you withdraw funds in retirement.”
This post was edited on 7/21/23 at 9:18 pm
Posted on 7/21/23 at 9:22 pm to masoncj
Ok so now we're on the same page. A minority of plans allow that.
It is also related to mega backdoor ROTHs in a 401k which also is your mileage may vary.
It is also related to mega backdoor ROTHs in a 401k which also is your mileage may vary.
This post was edited on 7/21/23 at 9:23 pm
Posted on 7/25/23 at 6:18 am to Teddy Ruxpin
To clarify this conversation, you guys are discussing after tax contributions vs pre tax contributions to a 401k
LINK
LINK
Page 1 of 1
Popular
Back to top
Follow TigerDroppings for LSU Football News