dmertz
Level 15

Deductions & credits

I haven't investigated this before, but from what I see, your compensation for making Roth 401(k) contribution is not reduced by any amount that you exclude as foreign-earned income.  First, your employer has no way of knowing whether or not you are going to claim the FEIE and section 415(c)(1) simply refers to "compensation."  Second, if you were self employed, section 415(c)(3)(B) explicitly states that your compensation is "the participant’s earned income (within the meaning of section 401(c)(2) but determined without regard to any exclusion under section 911)."  I see no reason that an employee's compensation would have to be reduced for this purpose if a self-employed individual's is not.

View solution in original post