My son is 20 and makes W2 income $8000/year.
He can contribute up to 80% of his income into a company Roth 401, and get matching non Roth contribution.
Can he also contribute the full $6500 into a Roth IRA, or is this reduced based upon low total income?
Is $8000 the max for all Roth accounts combined, or can he double up across different Roth accounts?
I want to recruit an expert to this conversation.
I reviewed publication 590-A and I did not see a requirement that his eligibility (compensation) was reduced by the amount that was contributed to the Roth 401k. I think, like you probably think, that it would be logical that his eligiblity would be reduced, but I don't see that in writing. (And it would be reduced by a pre-tax 401k since that reduces his W-2 box 1 wages. But I don't see it for a Roth 401k.) But I want to double check with another expert who knows all the details of these plans.