Ask the Experts!
The professionals at Advanced Underwriting Consultants (AUC) answer the tax questions posed by producers. Here’s the question of the day.
Question: My client participates in a Roth 401(k). Can his employer match his designated Roth contributions?
Answer: Yes, but the matching contributions would not be deposited into the designated Roth account. The employer’s matching contribution must be made into a pre-tax account, as if the employer was matching contributions on traditional, pre-tax contributions. The employer must establish a separate account and keep the designated Roth contributions completely separate from its matching pre-tax contribution.
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