Conversation Toolkit

Making after-tax 401(k) contributions

Topic overview

After-tax accounts in 401(k) plans allow participants to contribute a portion of their pay on a post- or after-tax basis, which means without lowering their taxable wages for federal income tax purposes.

After-tax contributions appeal to plan participants interested in putting more of their own pay into the plan — pay that is above the annual limits for their employee salary deferrals and Roth contributions.

Use these tools to help your clients maximize their savings in a tax-efficient way.

Is this relevant to my clients?

Individuals could benefit from these tools if they:

  • Are 401(k) plan participants who have maxed out their employee salary deferrals and designated Roth contributions
  • Earn too much to be eligible to make Roth IRA contributions

How to Use Your Toolkit

  1. Schedule client meetings to discuss this opportunity.
  2. Email the Pre-Meeting Overview to your clients to set their expectations.
  3. Print out the Meeting Worksheet and review it together.
  4. Expand your knowledge even further and download the White Paper. Consider sharing it with your clients' CPAs, tax advisors and attorneys for more in-depth discussions.

Disclosures

This material is for educational purposes only. It cannot be used for the purposes of avoiding penalties and taxes. Columbia Threadneedle Investments does not provide tax or legal advice. Consumers should consult with their tax advisor or attorney regarding their specific situation.