401(k) Calculator

The §402(g) employee elective deferral limit is $23,500 for 2025 and rises to $24,500 for 2026 (IRS Notice 2024-80 / Notice 2025-67). Age-50+ catch-up under §414(v) is $7,500 / $8,000, so age-50+ employee totals are $31,000 / $32,500. The §415(c) combined employee + employer limit is $70,000 / $72,000 — or $77,500 including the 2025 age-50 catch-up.

SECURE 2.0 §603 created an enhanced catch-up for participants aged 60, 61, 62, and 63 — the GREATER of $10,000 or 150% of the regular age-50 catch-up, indexed for inflation. For 2025 and 2026 that resolves to $11,250 / $11,250. Combined with the base deferral, ages 60-63 can defer up to $34,750 of their own salary in 2025. After age 63 the catch-up reverts to the regular $7,500/$8,000 amount.

Traditional contributions reduce current taxable income; the account grows tax-deferred; distributions in retirement are ordinary income. Roth contributions are after-tax (no deduction today); the account grows tax-free; QUALIFIED distributions in retirement are entirely tax-free under §402A. The decision hinges on your CURRENT marginal rate vs your EXPECTED retirement marginal rate. A 24%-bracket worker who expects to retire at 12% should prefer Traditional; a 12%-bracket worker who expects to retire at 24% should prefer Roth. SECURE 2.0 also required Roth treatment of catch-up contributions for high earners (W-2 ≥$145k indexed) starting plan years 2026+.

Employers can match a percentage of your contribution up to a salary cap. A typical formula is "50% of the first 6%": at $100k salary contributing 6% ($6,000), the employer adds $3,000 — a 50% instant return on the matched dollars. Some employers match dollar-for-dollar up to 3-5%. ALWAYS contribute at least to the full match — leaving match unfunded is leaving compensation on the table. Match contributions count toward the §415(c) total limit ($70,000 for 2025), not the §402(g) deferral limit.

Vesting determines when employer match contributions become permanently yours. Three schedules are common: IMMEDIATE (100% vested from day 1), 3-YEAR CLIFF (0% until 3 years of service, then 100%), and 6-YEAR GRADED (20% per year starting year 2, full at year 6). Your OWN deferrals are ALWAYS 100% vested regardless of schedule. If you leave before fully vested, you forfeit the unvested portion of employer match — check your Summary Plan Description (SPD) for your plan's specific schedule.

If your 401(k) plan allows (a) AFTER-TAX (non-Roth, non-Traditional) contributions AND (b) in-plan Roth conversions or in-service withdrawals, you can stack additional contributions above the §402(g) deferral cap, up to the §415(c) total limit. For 2025: $70,000 total cap minus your elective deferrals minus employer match = available after-tax space. Convert those after-tax dollars to Roth (in-plan) for tax-free growth. See /mega-backdoor-roth-calculator/ for the year-by-year value.

Under SECURE 2.0 §107, Required Minimum Distributions begin at age 73 (for those reaching 72 in 2023+) and step to age 75 in 2033. RMDs are calculated using the IRS Uniform Lifetime Table — for example, the 2025 divisor at age 73 is 26.5. Failure-to-take penalty is 25% of the missed RMD (reduced to 10% if cured within 2 years and reported on Form 5329). Roth 401(k) RMDs were ELIMINATED starting 2024 under SECURE 2.0 §325 — Roth 401(k) now matches Roth IRA treatment.

Yes — a direct trustee-to-trustee rollover (preferred over the 60-day indirect method) preserves tax-deferred status. Traditional 401(k) → Traditional IRA, Roth 401(k) → Roth IRA. A direct rollover has no 20% mandatory withholding; an indirect rollover triggers 20% withholding which you must replace with other money within 60 days to avoid taxation. Reported on Form 1099-R (distribution) and Form 5498 (receiving IRA). For high earners, retaining a separate Traditional 401(k) preserves the backdoor Roth IRA pro-rata workaround.</a>

The §402(g) $23,500 elective deferral limit (2025) is a PER-PERSON limit, not per-plan. If you contributed $10,000 to a former employer's plan in 2025 and start a new job, you can only defer $13,500 to the new plan that year. Each employer's §415(c) $70,000 total limit is SEPARATE per unrelated employer, so high earners with two unrelated W-2 jobs can theoretically receive $70,000 of contributions in EACH plan — though the elective-deferral cap still binds across both.

You can borrow up to the LESSER of $50,000 or 50% of your vested balance for up to 5 years (longer for home purchase). Repaid via payroll deduction at prime + 1-2%, with interest going back to your OWN account. Risks: leaving the company makes the unpaid balance due as a deemed distribution (taxable + 10% penalty under §72(t) if under 59½). SECURE 2.0 §523 added emergency hardship withdrawals up to $1,000/year penalty-free. Generally last resort — opportunity-cost-of-missed-growth often exceeds the loan benefit.

If you're "covered" by a workplace plan (any 401(k) deferral year, even $1), your Traditional IRA deduction phases out at moderate income. For 2025 single covered participants: phase out $79,000-$89,000 MAGI. MFJ both covered: $126,000-$146,000. The Roth IRA contribution itself phases out at $150,000-$165,000 (2025 single) regardless of 401(k) coverage. The /roth-vs-traditional-ira/ calculator handles the phase-out math.

Your designated beneficiary (NOT your will) controls the account. Spouse beneficiaries can roll it into their own IRA. Non-spouse beneficiaries under SECURE Act 2020 must EMPTY the account within 10 years for most accounts (Eligible Designated Beneficiaries — minor children, disabled, chronically ill, beneficiaries within 10 years of decedent's age — keep the stretch). No annual RMDs during the 10 years if decedent died BEFORE RMD age; annual RMDs required during years 1-9 if after. Designate beneficiaries explicitly — accounts without designation often go through probate.

Yes. The 401(k) limit ($23,500 elective deferral 2025) and the IRA limit ($7,000 2025) are independent. A 40-year-old can fully fund both for $30,500 of annual tax-advantaged contributions. Age-50+ adds $7,500 (401k) + $1,000 (IRA) for $39,000 total. IRA deductibility phases out if you're 401(k)-covered (see prior FAQ), but Roth IRA contributions remain available within the Roth income limits.