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Roth 401(k) Knowledgebase

Deferral Limits and Eligibility Requirements

Individual Pre-tax and Roth 401(k) Contribution Limits

401(k) Individual Contribution Limits

Calendar Year

 2009

Calendar Year

  2010

401(k) Limit

$16,500

$16,500

Catch-up Limit

(age 50 or older)

$5,500

$5,500

No AGI Limit for Eligibility  The adjusted gross income limits (AGI) that apply to Roth IRAs, do not apply to Roth 401(k)s.  Therefore, if the employer's plan offers this feature, all eligible plan participants can contribute to a Roth 401(k). 

Individual Calendar Year Limit The 401(k) individual contribution limit for calendar year 2010 is $16,500.  Participants who are or become age 50 in calendar year 2010, may contribute an additional “catch-up” contribution up to $5,500.  These limits apply to the all 401(k) contributions, whether they are Roth, pre-tax, or a combination of Roth and pre-tax.

COLAs (cost-of-living adjustments)  After 2006, the individual 401(k) and catch-up limits increase based on the annual COLA in minimum increments of $500. 

401(k) Individual Contribution Limits

 2009

2010

2011

with COLA*

2012

with COLA*

2013

with COLA*

401(k) Limit

$16,500

$16,500

$17,000

$17,500

$18,000

Catch-up Limit       (age 50 or older)

$5,500

$5,500

$5,500 $5,500

$6,000

*Limits shown for 2011-2013 are estimated based on historical increases.  In general, the annual COLA is calculated by comparing the rise in the Bureau of Labor Statistics’ Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) from the third quarter of the prior year to the corresponding period of the current year.

Not a Plan Limit  The individual 401(k) and catch-up contribution calendar year limits apply to the total of all contributions in all 401(k) plans in which one participates, whether the employers are unrelated or considered related. This means that an individual may participate in two or more separate plans of two or more employers; however, the total of all contributions to all of these plans may not exceed the  individual 401(k) and catch-up calendar year limits.

Marginal Tax Rate (MTR)

2010 Tax Brackets and Rates (rows are "Tax Brackets")

Tax Rate

Married Filing Joint & Surviving Spouses

Unmarried Individuals

Heads of

Households

Married Filing Separate

10%

$0 - 16,700

$0 - 8,350

$0 - $11,950

$0 - 8,350

15%

$16,701 - 67,900

$8,351 - 33,950

$11,951 - 45,550

$8,351 - 33,950

25%

$67,901 - 137,050

$33,951 - 82,250

$45,551 - 117,450

$33,951 - 68,525

28%

$137,051 - 208,850

$82,251 - 171,550

$117,451 – 190,200

$68,526 - 104,425

33%

$208,851 - 372,950

$171,551 - 372,950

$190,201 - 372,950

$104,426 - 186,475

35%

over $372,950

over $372,950

over $372,950

over $186,475

The table above indicates the tax rate paid on the last dollars earned after all permissible deductions such as the standard deduction and deductions for dependents, mortgage interest and pre-tax contributions to a 401(k) plan, and credits such as the child care credit.

Example: Lower Future Bracket May Not Mean Lower Rate

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