Roth 401(k) Match Calculation

[Guest Julie]

On Jan. 1, 2012, we're adding the Roth 401(k) feature to our 401(k) plan. I'm a little confused on how to calculate the company match if a participant contributes to both pre-tax and Roth. Our plan matches up to the first 6% -- 100% on the first 1% and 50% on the next 5. If a participant contributes, for example, 3% to pre-tax and 3% to Roth, how is the match calculated?

[Tom Poje]

it shouldn't make a difference. a Roth is still a deferral, and if you are matching deferrals the Roth would get matched.

so if the person defers 3% deferral and 3% roth he has deferred 6% in total.

and a match is still a match. you don't have a 'match account based on Roth' - or at least I wouldn't think one would want to track things that way.

[GMK]

so, in the OP, half of the match dollars to the pre-tax and half to the Roth, yes?

[Kevin C]

The first step is to see what the plan says. Our VS document allows you to have the regular match apply to either only pre-tax deferrals or to only Roth deferrals. I wouldn't want to use that type of provision, but it is possible. (It does say this provision can not be used for the SH match.)

Assuming the Roth amendment in question says all deferrals are matched, the participant who defers 3% pre-tax and 3% Roth is deferring 6% of compensation and would receive the same match that he would if he deferred 6% of comp pre-tax. Matching contributions can not have Roth treatment, so I can't think of any reason to track match attributable to the Roth deferrals separately.