Annual 401k limit

Amazon
hahah765

Go to company page Amazon

hahah765
Mar 22 21 Comments

Is the annual 401k limit of $20,500 per company or per year toal. Example, if I move from Amazon to say Microsoft, can I contribute, $20.5k in each place or just $20.5k total?

I am trying to see how do I get full benefits of MSFT matching, which is 50% of IRS limit.

TC: $280k

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 TOP 21 Comments
  • Roku
    BCTh44

    Go to company page Roku

    BCTh44
    Per year. It only count your contribution though. Company contributions dont count to the limit.
    Mar 22 0
  • Per year total
    Mar 22 0
  • You can do after tax contributions up to 61k tho.
    Mar 22 6
    • I read online saying that you have to transfer the difference of the (employer contribution + employee contribution ) to a Roth-IRA. Is that how it is normally done? My question to you is if I’m able to contribute 61k to my 401k, is it as easy as just increasing my biweekly deferral contribution to my 401k?

      And are there any negative consequences? Cause it sounds too good to be true
      Mar 22
    • Your company has to offer the ability to contribute after tax contributions (these are not Roth contributions), so it’s just rare (outside of big tech) for companies to offer this.

      You have to convert after tax contributions to Roth. After that you can either leave in 401k, or transfer (Roth contributions) to a Roth IRA. People only transfer Roth contributions to an ira for more investment choices. I don’t because in MSFT 401k you can invest in anything a brokerage has.
      Mar 22
  • New
    TaxBro

    New

    TaxBro
    I'm a tax professional and can confirm what others are saying that it's per year regardless of number of employers you had during the year.
    Mar 22 2
    • Willis Towers Watson / Product
      TRYA85

      Go to company page Willis Towers Watson Product

       TRYA85
      Does that include employer match or just your individual contribution?
      Mar 22
    • New
      TaxBro

      New

      TaxBro
      Just individual. For 2021, the employee and employer match together couldn't exceed 58k. In theory, your employer could contribute up to 38.5k.
      Mar 22
  • New
    denshaSai2

    New

    denshaSai2
    Per year. You need to make sure your second company does not go over the limit. If you did you have to pay back in tax return
    Mar 22 0