Multiple 401(k) plans maximum deferral

[Guest mopar]

Can an individual with more than one employer, with each employer offering a 401(k) plan to their employees, contribute the maximium to each plan? Employers and plans are non-affiliated. Does the IRS have an aggregate maximium contribution to 401(k) plans in any given year?

[david rigby]

No.

Yes.

Related discussion: http://benefitslink.com/boards/index.php?showtopic=25060&hl=

[K-t-F]

Each employer can contribute on behalf of the employee as long as each employer is not affiliated. Each plan has a contribution limit know as the 415© limit. That is a per plan limit

If your question is can the employee make deferral contribtions to all plans he/she is apart of, the answer is yes. The catch is that the total of all the deferrals made to all the plans he/she is apart of can not exceed the 402g limit for the calender year. The 402g limit is a limit imposed on the individual, not the plan.

2004 402g limit is $13,000. If the employee is over the age of 50 then he/she can defer an additional $3,000

[MGB]

Also note this is why there is a box on the W-2 showing the amount deferred by the individual. One of the checks that the IRS does is to add together these figures across all W-2s to verify the total from multiple employments does not exceed the limit.

Also note this rule applies equally whether the multiple employers are consecutive (e.g., quit one mid-year and then go to a new employer) or at the same time (e.g., a full-time job and a part-time job at night).