Why sign in to the Community?

  • Submit a question
  • Check your notifications
Sign in to the Community or Sign in to TurboTax and start working on your taxes
New Member
posted May 19, 2020 11:04:35 AM

Is Roth 401k contributions the same as Roth IRA?

0 2 1891
1 Best answer
Level 15
May 19, 2020 1:04:47 PM

A 401(k) must be sponsored by an employer, and the only way to make contributions is via payroll deduction.  

 

An IRA is a private account you set up with a bank, stock broker or investment advisor.  

 

A Roth IRA and a "Roth" 401(k) (a post-tax 401(k)) are similar in that you contribute money after taxes--you pay taxes on the money now and don't take a tax deduction for contributions.  When you retire, you withdraw the money tax-free.

 

However, a Roth IRA and a post-tax 401(k) have different contribution rules, different contribution limits, and different withdrawal rules.

 

Do you have a specific question?

2 Replies
Level 15
May 19, 2020 11:07:24 AM

No.  401K Contributions come out of your paychecks.  You only enter it from your W2.

 

 IRA Contributions you make yourself outside of work.  You do enter IRA under Deductions & Credits.  

Level 15
May 19, 2020 1:04:47 PM

A 401(k) must be sponsored by an employer, and the only way to make contributions is via payroll deduction.  

 

An IRA is a private account you set up with a bank, stock broker or investment advisor.  

 

A Roth IRA and a "Roth" 401(k) (a post-tax 401(k)) are similar in that you contribute money after taxes--you pay taxes on the money now and don't take a tax deduction for contributions.  When you retire, you withdraw the money tax-free.

 

However, a Roth IRA and a post-tax 401(k) have different contribution rules, different contribution limits, and different withdrawal rules.

 

Do you have a specific question?