Roth 401(k) | Ed Slott and Company, LLC

Roth 401(k)

Roth IRA vs. Roth 401(k)

Monday, April 17, 2023
More 401(k) plans are starting to offer Roth options. If you now have this option, you may be wondering what the difference is between a Roth IRA and a Roth 401(k). Which account is right for you? These accounts have a lot in common. Both offer the ability to make after-tax contributions now in exchange for tax-free earnings down the road if the rules are followed. However, there are some important differences between the two plans that you will want to understand.
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SECURE 2.0 Glitches and Unanswered Questions

Wednesday, March 08, 2023
Considering that it made 92 new IRA and retirement plan changes and is 357 pages long, it’s not surprising that the new SECURE 2.0 law has several unintended drafting errors and lots of unresolved questions. The drafting errors will have to be fixed, either by Congress in “technical corrections” legislation or by the IRS. The first concerns the delay in the age when RMDs (required minimum distributions) must start. The way SECURE 2.0 now reads is that someone born during 1959 will have two RMD ages: 73 and 75.
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The Las Vegas Conference

Wednesday, October 26, 2022
The Ed Slott team hosted a highly successful training program for members of our Elite and Master Elite Advisor groups last week in Las Vegas. Over 300 financial advisors from across the country attended. Feedback on the educational material provided was positive, with one attendee saying he “never felt more empowered” in his 18-year career.
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How Are Roth 401(k) Distributions Taxed?

Wednesday, September 21, 2022
More and more 401(k) plans now offer Roth contributions. At the same time, Americans are changing jobs and receiving 401(k) distributions in record numbers. So, it’s a good time to review the tax rules that apply to Roth 401(k) withdrawals. (The same rules also apply to Roth 403(b) and Roth 457(b) withdrawals.)
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6 Ways That Roth IRAs and Roth 401(k)s Are Different

Wednesday, November 11, 2020
Both Roth 401(k)s and Roth IRAs offer the ability to make after-tax contributions now in exchange for tax-free earnings down the road if the rules are followed. However, there are some important differences between the two retirement accounts that you will want to understand. 1. Contributions limits are higher for Roth 401(k)s One major difference is in the amount that you may contribute. Your Roth IRA contribution is limited to a maximum of $6,000 for 2020 if you are under age 50.
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Tax Rules for Roth 401(k) Distributions

Monday, July 27, 2020
With more 401(k) plans offering Roth contributions and more folks taking distributions from their plans, now’s a good time to review the tax rules governing Roth 401(k) distributions.
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Roth IRA & Roth 401(k) – The Basics

Monday, July 15, 2019
Roth IRAs and Roth 401(k) plans are incredibly popular, and why wouldn’t they be? Both offer tax-free earnings and allow the account owner to pass tax-free dollars to their beneficiaries. However, despite the ubiquity of Roth accounts, there are some common misunderstandings about how Roth IRAs and Roth 401(k)s operate and interact with each other. Confusion swirls around such basic concepts as contribution limits, eligibility and Roth rollovers. For example, income limits apply to Roth IRA contributions only There are no income limits for designated Roth 401(k) plan salary deferrals. Contributions are the initial building block of Roth IRAs.
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Do You Know All the Rules for Rolling Over a Roth 401(k)?

Thursday, September 28, 2017
This week's Slott Report Mailbag examines 401(k)s, Roth 401(k)s, and spousal beneficiary rules.
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How a Roth 401(k) is Different than a Roth IRA

Monday, June 05, 2017
Roth 401(k)s and Roth IRAs have a lot in common. Both offer the ability to make after-tax contributions now in exchange for tax-free earnings down the road if the rules are followed. However, there are some important differences between the two plans that you will want to understand.
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Will I Pay Tax When I Convert to AND Distribute Funds from a Roth IRA?

Thursday, April 14, 2016
It's time for another edition of The Slott Report Mailbag, where we answer consumer questions on situations involving Roth conversions and the pro-rata rule, whether you need earned income to contribute to a Roth IRA and certain Roth IRA tax scenarios (reminder: Tax Day is Monday!)
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