401k after tax conbribution (mega backdoor) eligibility

[DatBio]

My work 401k allows AFTER TAX contribution and I want to know who is eligible of doing that? 

Do I need to meet below requirements in order to do so?

1. Gross income exceed the contribution limit for Roth IRA (example: $240K for married couple)

2. Have max out the 401K contribution limit of $23000 or $305000 if older than 50.

I read a few places saying the above but not everywhere. And I can't find the answer from IRS site.  And, my work 401k let me know do so even I do not meet the above two points.  I want to know if I am violating the tax rule. Please hep.

Thanks in advance.

[Opus 17]

The 401k contribution rules have nothing to do with IRAs, they are controlled by completely separate laws and rules.

For 2024, you can contribute up to $23,000 to a 401k by salary deferral, or $30,500 if you are age 50 or over.  The maximum total contribution to a 401k, including employer match, is $69,000.

If your employer offers a designated Roth option within the 401k, the same limits apply.  However, any employer match must be contributed to a traditional pre-tax 401k account.

Whether you can also make Roth IRA contributions, or make deductible contributions to a pre-tax IRA, depends on your filing status, income, and participation in a workplace place, and the limits are here.

https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-ira-contribution-li...

[DatBio]

Question: if I have not yet maxed out my 401k contribution, is it okay to contribute to 401k AFTER TAX portion?

The reason I am doing this is that my company match is only for 401k contribution but not for catch up contribution. If I max out my regular 401k contribution, I will lose some of company matching.

[Opus 17]

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@DatBio wrote:

Question: if I have not yet maxed out my 401k contribution, is it okay to contribute to 401k AFTER TAX portion?

The reason I am doing this is that my company match is only for 401k contribution but not for catch up contribution. If I max out my regular 401k contribution, I will lose some of company matching.

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You can contribute a maximum of $23,000 per year by salary deferral (or $30,500 if over age 50).  It doesn't matter whether you contribute to a pre-tax 401k account, a designated Roth 401k account, or a combination.