{ "media_type": "text", "post_content": "Basic 401k question - If I contribute x% of salary to max 19k limit. What happened in case contribution goes above 19k.Will employer does calculations and deduct only remaining portion in last payroll", "post_id": "5cd2178005ab210021d50295", "reply_count": 10, "vote_count": 1, "bowl_id": "59064a3cb12379001006592c", "bowl_name": "Personal Investment Chatter" }

Basic 401k question - If I contribute x% of salary to max 19k limit. What happened in case contribution goes above 19k.Will employer does calculations and deduct only remaining portion in last payroll

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Unless you are an Architect for a koolaid stand it should automically stop at 19k yes. If you overcontribute there’s a form will fill out with the 401k company to request the overage back.

funny

OP - I don't think CTM was taking a crack at you but trying to imply that any reputable company will take care that your portion of the contribution stays within 19k.

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Your employer will stop deducting once your contributions hit 19k.

You should have the option to stop or reduce to the company match, I believe it’s taxed (ask an accountant), but still better than no match.

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The good news is every paycheck after you hit $19K will be fat. The bad news is you’ll want to blow the extra on vices and Christmas presents

Some 401k plans offer after-tax 401k - so overage can also spill-over into that 401k category. You can then convert that to Roth 401k if your plan offers this account type. And if they do offer Roth 401k, consider whether you want your primary contributions (or a portion) up to the $19K to go into Roth vs Traditional 401k (basically deciding whether to pay tax now with Roth 401k and withdraw all proceeds including gains tax-free in retirement, vs taking a tax deduction now with Traditional 401k and then paying income tax on all annual withdrawal amounts including gains in retirement). A combination of Roth 401k and after-tax 401k and conversions is how the “Mega Backdoor Roth” of up to $56K/yr is achieved.

Just be careful if your contributions for the year weren't all at one company. I've had to track on my own. I've heard over contributing is an IRS pain in the...

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