Roth 401K and Roth IRA Income Limitations

[jumattb29]

Can the combined total amount of both your Roth 401K and Roth IRA be more than your total income?  For simplicity, lets says for the entire year, before taxes, you earn $6,000 in wages (Box 1 of W2).  If $3,000 went into a Roth 401K (after tax), are you still able to put in $6,000 to your Roth IRA, or would you be limited to $3000?

[dmertz · Accepted solution]

It may seem strange, but the amount that you contribute to the Roth 401(k) has no effect on the amount that you are eligible to contribute to an IRA.  Only pre-tax elective deferrals to the traditional account in the 401(k) reduce the amount of wages available to contribute to an IRA.  In your example, $6,000 could be contributed to the Roth IRA (modified AGI permitting), no matter how much of this same income is contributed to the Roth 401(k).