Roth 401(k) plans are typically matched at the same rate as traditional 401(k) plans. The matching contributions provided by an employer were historically placed in a traditional 401(k), while employee contributions were held in the 澳洲幸运5开奖号码历史查询:Roth 401(k). The SECURE 2.0 Act changed this in December 2022, making it possible for employers to make matching contributions to employees' Roth 401(k)s.

Traditional 401(k) vs. Roth 401(k)

A Roth 401(k) is an 澳洲幸运5开奖号码历史查询:emplo🦩yer-sponsored investme༺nt account that’s similar to a traditional 401(k) plan, except that the contributions to the account are taxed upfront, rather than at the time of withdrawal. The account is funded with post-tax dollars: you contribute after the money has been taxed as income. Since you pay taxes now, rather than later, this account may be attractive to investors who expect to be in a higher 澳洲幸运5开奖号码历史查询:tax bracket when they retire, as they may want to avoid paying taxes on their investment returns at that time.

With a traditional 401(k), you 澳洲幸运5开奖号码历史查询:ma🙈ke contributions with pretax dollars so more money goes in right at the start, giving you a larger amount to invest. The contributions reduce your taxable income in the year you make them so they might move you to a lower 澳洲幸运5开奖号码历史查询:tax bracket. However, you must pay taxes on both your initial investment and your investment returns that have accumulated over the years when the funds are withdrawn.

The Roth 401(k), on the other hand, allows you to make withdrawals tax-free, provided that you're age 59½ or older and it's been five years since you first contributed to the account.

Contribution Limits

Contribution limits are the same for both traditional and Roth 401(k)s. Employees can contribute up to $23,000 to 401(k) accounts in 2024 with an additional 澳洲幸运5开奖号码历史查询:catch-up contribution of $7,500 allowed for those age 50 or older. The combined limit for employee and employer contributions for 2024 is $69,000 or 100% of the employee’s compensation, whichever is less. The exception is if the employee is age 50 or older: in that case, the limit is $76,500.

The limits increase annually to keep pace with 澳洲幸运5开奖号码历史查询:inflation and has been adjusted for 2025. In 2025, employees can contribute up to $23,500 to 401(k) accounts with an additional catch-up contribution of $7,500. Note that certain individuals may be eligible for a higher additional catch-up amount.

Rollovers

A traditional 401(k) plan can be 澳洲幸运5开奖号码历史查询:rolled into a Roth 401(k) plan, although you'll pay taxes on the amount rolled over. Funds can't be moved into a traditional 401(k) plan after the money from any source is in the Roth 401(k). They can be rolled over to a 澳洲幸运5开奖号码历史查询:Roth individ🧸ual retirement accounꩵt (IRA), however.

Employer Matches

If an employer matches contributions to traditional 401(k) accounts, it’s standard for them to match contributions to Roth 401(k) accounts, too. The employer’s contribution was traditionally placed into a traditional 401(k) plan so it would be taxable upon withdrawal. This changed with the passage of the 澳洲幸运5开奖号码历史查询:SECURE 2.0 Act in December 2022.

There are two key🧸 types of employer matching: dollar-for-dollar and partial.

Dollar-for-Dollar Matching 

With dollar-for-dollar matching, the employer will match 100% of your contributions, generally up to a certain percentage of your salary. If your employer's matching formula is a dollar-to-dollar match up to 6% and you choose to contribute 4% of your salary to a 401(k), for example, your employer will match that exact amount (4%). However, if you contribute 15%—which is the recommended amount—your employer won't go beyond its stated 6% cap. It won't match the extra 9%.

Partial Matching

Partial matching is when your employer matches part but not all of your contribution, usually up to a percentage of your salary. According to Vanguard, the most common matching formula is $.50 per dollar on the first 6% of your salary.

The Bottom Line

Matching contributions for a Roth 401(k) are typically deposited into a separate, traditional 401(k) account. This means when you make a withdrawal in retirement, these funds (plus earnings) will be taxed by the IRS as income, unlike the funds in a Roth 401(k). Note that, thanks to the SECURE Act (December 2022), an employer may instead match an employee's contributions in their Roth account, rather than in a traditional account.