Questions tagged [401k]

A 401(k) account is a tax-deferred retirement savings account setup by many employers for their employees in the United States. Employees can elect to contribute part of their earnings - either pre-tax or after-tax - to their 401k account and the employer will often make a matching contribution for a portion of it. The before-tax and/or after-tax contributions are subject to yearly limits set by the IRS. Related to the 403b and Thrift Savings Plan (TSP)

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2answers
130 views

Is it true that when we can contribute $60,000 into pre-tax or after-tax 401(k), it can be all after-tax so we never have to worry about the tax?

Some suggestion is that if we plan to have lower tax bracket when we retire, we can contribute into 401(k) pre-tax instead of after-tax. However, if some people may contribute $60,000 into either pre-...
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3answers
156 views

Can a client pay directly into an IRA/401K?

I have a leftover 401K from my previous employer (in fact I have two of them from two different employers). Currently, I am drawing some income as a sole proprietor of a management consulting company....
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88 views

When we retire and take out the 401(k) and IRA money to buy a house, are we subject to a big portion of tax?

Say, when we get to the age of 65 or 67, and retire, and we take out most of the 401(k) and IRA money, if luckily they can grow to $1,000,000 to buy a second house, all at once, will we be subject to ...
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0answers
74 views

What is the amount we earn that we don't have to pay tax in US and California?

I hope to find out if after retirement, if I live in Oregon, or even Thailand, or Taiwan, is it true that if I sell stocks in my 401(k) plan for $15,000, and make a profit of $10,000 and I can live on ...
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3answers
516 views

Is there a point to contributing to a nondeductible traditional IRA?

I, 24 y/o US citizen employed in the US, make over the 137k cut off for making contributions towards a Roth IRA. As a result, I have considered contributing to a traditional IRA. However, I am not ...
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1answer
65 views

The 50% 401K matching and 100% 401K matching can make the total contribution to $29,250 and $39,000, respectively?

Since there is a max for our contribution of $19,500, so (1) if a company matches 50%, that means the total max out at $29,250? On the other hand, (2) if a company matches 100% but only for 4.5%, ...
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1answer
59 views

For the $19.5k limit for 401K contribution in US for 2020, does that include the company matching? [duplicate]

I thought it doesn't include the company's matching, or does the $19.5k actually include the part that the company will match?
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1answer
68 views

Is a 401k withdrawal considered “earned income?”

I left my job in 2018, where I earned $3000 that year. At that point I had $500 in a 401k plan, which was too small to do a rollover to an IRA, so I cashed it out (after 20% tax I received $400, and ...
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If I take a home equity loan out can it “add” PMI to my mortgage?

So ironically I took out a 401k loan to avoid PMI on a property we purchased. I've recently left the job where I had the loan and want to repay the balance, but will need to borrow in order to do so. ...
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1answer
127 views

401K Liquidation

I contributed to a 401(k) for the past three years and due to market volatility there is no gain in my contribution. Its hard earned money. Is it possible to sell all the stocks and bonds contributed?...
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1answer
48 views

Retirement benefits vs. better salary/health insurance

I'm a research scientist and postdoctoral fellow in a US government lab. Currently, my position is funded through a DOE-run organization as an educational/training position. The salary is good for my ...
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2answers
51 views

Contributing to a target fund after the date of the fund

If I contribute to a target fund that's targeting 2040 as a retirement date, but I don't end up retiring until 2043 what will happen after 2040? Will I still be able to contribute to the same plan ...
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1answer
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When is a 401(k) better than a pension?

There are tons of comparisons between 401(k) and pensions, with the most obvious being the concept of "defined contribution" vs. "defined benefit". This makes them a sort of apples to oranges ...
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0answers
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My company switched 401k Providers and the new provider re-amortized my loan and changed the payments

My company switched 401k providers a few years back. Recently I have been playing around with amortization tables in excel and realized that my payment should have been lower. After talking with ...
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1answer
119 views

Can an ill-advised 401k withdrawal be undone?

A friend of mine purchased a home last year after renting for a while. She is approximately 60 years of age. When considering how to finance the purchase, she considered two options: Taking out a ...
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w8ben for 401k withdrawal for Indian citizen

I need to withdrawal my 401k from US account.Normal penalty is around 30% for early withdrawal .Does filling w8ben form for Indian citizen help in reduced penalties.I am in individual who worked in US ...
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1answer
64 views

401K Enrollment Benefits

I have enrolled in my 401K plan from 2016 onward. While looing into the investment portal, right now I am having only 68K but I contributed for 69K. Is it still worth in enrolling 401K? If I invested ...
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1answer
43 views

My Employer Contribution each year Using W2 form

I contribute to my 401K each month but I am not sure how much my employer is contributing each year to my 401K. They said they will match 5% of my salary but I am not able to find that number in my ...
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1answer
126 views

Do we need to worry about “maxing out” our 401K limit and the company won't match their part any more?

Let's say, if the company would match my 401K contribution, up to 4.5%, and with the current 2020 limit of $19500 and $6500 for age 50 and above for catch up, it is $26,000. Each paycheck every two ...
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0answers
25 views

Excess 401k deferral: which account?

I switched jobs in the middle of 2019 and hence have multiple pretax 401k accounts (traditional). I have excessive deferral when I combine my contributions to both accounts (14k to each account) and I ...
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2answers
81 views

Does it matter if one company matches 100% of your 401k contribution vs another company matches only 50%?

Let's say the base salary is $150k, if company A matches 100% of your 401k contribution, but up to 4.5% of your pay. So it is $6750 per year. If company B matches 50% of your 401k contribution, but ...
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2answers
76 views

With a 401k, can I sign up first, and then switch to different investment types and buy/sell them later?

For example, our company's 401K has an easy choice of "BlackRock US index fund" (for Dow Jones 30 DJI) using Fidelity, and does not require opening a broker account. Should I just start using the ...
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7answers
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The “Cares act” allows $100,000 of 401k withdrawal without penalty. What are the reasons not to do this?

From this website , we can pull out $100,000 from our 401k without penalty. Distributions taken from qualified retirement plans received during 2020 of up to $100,000 for COVID-19 related ...
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41 views

Maximize multi employer contributions to 401k [duplicate]

I switched jobs in the middle of 2019 and both my previous and current employer had great 50% matching 401k plans. I contributed pre tax 14k to my former 401k plan and pre tax 14k to my current ...
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1answer
73 views

Tax breakdown for bonus income

Say the bonus is $8000 and $6800 are set for a 401k (pre-tax) deduction. Here's the tax breakdown. Does this look right? Shouldn't the taxes be calculated on the $1200? ($8000 minus $6800 due to pre-...
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4answers
846 views

How to balance paying off student loans with 401k contributions when employer matches 100%, up to federal maximum?

I've regularly heard the best advice for a young professional is to max out your employer's 401k contributions (maybe 3-5%, or limited in some way), then focus the rest on paying down debts. After the ...
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1answer
76 views

How to file taxes for a backdoor Roth and 401(k) roll-in

I am planning to backdoor $6000 into my Roth IRA for 2019, which currently has nothing in it. I have $2500 in a traditional rollover IRA. I was going to put it into the Roth, but due to the ordering ...
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9answers
9k views

401(K) Very high negative rate of return

I am 26 yo and have total $27.5k contributed to my 401(K). I have chosen 2045 Blackrock target date fund and my 2020 first quarter rate of return is -37% due to the current market blood bath. I have ...
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1answer
130 views

Why am I not allowed to add to what my employer deferred for my 401k?

My employer deferred 6% of my income in 2019 to my 401k. I would like to now contribute up to the maximum limit of 19,000 in order to reduce tax liability. However, turbotax is saying that my income ...
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2answers
110 views

I initiated a 401k rollover to an individual IRA, but plan sponsor didn't execute

I got confirmation of my rollover on the phone but checked back 3 days later and the process had not taken place. I did this with the understanding that my fund holdings would be liquidated and then ...
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1answer
63 views

do forced withdrawals on 401K contributions include “interest” accrued on the contributed funds?

So let's say I max out my 401(k) ($19,000 in 2019) and then have a forced withdrawal of $10,000 because my company failed the highly compensated employee test. The $19,000 I put into the 401(k) is ...
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1answer
109 views

Can a previous employer contribute to my closed 401k after termination

I was terminated in late January of 2020 by my previous employer. I had worked for them for 5 years and 2 months. I had over 5k in my 401k account and withdrew it all a couple days after termination (...
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1answer
164 views

Do 401k contributions need to be invested? Can it be left as cash in the account? [duplicate]

As title. Since the market is a bit volatile now, wondering if I can keep the 401k contributions as cash and invest them later. Or does it necessarily need to be invested in one of the options that ...
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0answers
30 views

convert 401k after tax contribution to roth 401k

My company recently introduced a Roth 401K option to the traditional 401k retirement account. I have some existing after-tax contributions (~ $80,000 or so). If I convert this to a Roth 401K, my ...
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7answers
4k views

401k loan & repayment: double taxation?

I've heard a few people say that taking out a loan against your 401K and repaying it means that you are taxed twice: You are repaying your loan using after-tax dollars You are going to be paying a ...
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1answer
118 views

401k's from the employers side

Let's say you, as an employee, have $5,000 in 0% vested funds in a 401k. You don't get the money when you leave but what does happen to that money? Does that money get redistributed out to other 401k ...
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1answer
217 views

Can you un-enroll from 401k at any time?

Can you un-enroll from 401k at any time? Or is it like health insurance where you are locked into it until open enrollment periods?
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1answer
62 views

Can't see Balance in 401k account [closed]

I put about $400 into a 401k account, but the balance still says $0. Likewise, the vested balance is also $0. Why is this?
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44 views

401k benefits meaning: 10% of salary deferral subject to first 0.6% of compensation as elective contribution

From the benefits package of a prospective employer: CompanyX contribution: 10% of salary deferral subject to first 0.6% of compensation as elective contribution What does this mean?
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1answer
198 views

How much should you put in a 401k plan?

I am making ~$145,000 per year and was wondering if it is wise to contribute 12% pre-tax to my 401k? Is this too much? Is there any disadvantage in contributing nothing? I am already well off (come ...
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2answers
380 views

401k Match percentage - Does it include bonuses?

I'm the owner of a small business with one employee other than myself, and I'm looking at 401k plans for the business. A significant amount of this employees total compensation will end up coming ...
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1answer
149 views

Does purchasing a second home qualify for 401K hardship withdrawal?

I just asked Vanguard and they checked my withdrawal availability: Either Hardship withdrawal may only be taken for the following purposes: Purchase of a primary residence. Prevention ...
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0answers
52 views

Transfer from US 401k fund to Australian Superannuation fund

I worked in the USA for a number of years and have now relocated to Australia. I have balances in both US 401k fund (+ IRAs) and Australian superannuation fund. It seems that the Australian ...
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1answer
82 views

Does an in-service rollover of a Roth 401(k) to an existing 15 year old Roth IRA incur any tax?

I have a Roth 401(k) and want to roll it over into my existing 15 year old Roth IRA while still employed. Vanguard is the fiduciary for both. Is any part of this rollover considered taxable? I am ...
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1answer
60 views

Can you roll a traditional IRA into a 401k and do a Backdoor Roth IRA same year?

The following is a situation a few of my friends are in: Significant assets in traditional IRA Income above Roth IRA limits Their 401k plan allows you to roll regular IRAs into it Now, the prorata ...
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0answers
30 views

Do employers receive any financial benefit from offering a RRSP/401K matching program? [duplicate]

I understand that companies that offer RRSP matching programs may be more attractive to work for/have better employee retention, and the employers may get warm fuzzies from offering it to their ...
4
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1answer
126 views

How should I distribute investment types between differently-taxed accounts?

Background: I'm 37 and work in the U.S. I have a gross income ~100k, a 401k funded to the legal limit, a Roth IRA funded to the legal limit, and a regular investment account. The 401k has most of the ...
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0answers
68 views

Return of excess employer contribution after transfer to IRA

A few years ago, I had an internship, and had to set up an account with the employer's retirement fund company. A couple of years after leaving the company, I was closing out old accounts, and ...
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3answers
258 views

Best Way to minimize taxes on 401K distribution?

I recently retired at 57 after 36 years with the same employer. I live pretty frugally and my pension is $90K covers all my normal living expenses. I have approximately $2M in retirement savings most ...
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1answer
42 views

Stock Reclassification to ESOP in 401k

In my current 401k, there are periodic conversions (looks like the beginning of each year) of the classification of company stock to ESOP shares. There is no change in quantity of traded shares and ...

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