The contribution limit for a designated Roth 401(k) for 2020 and 2021 is $19,500. Account-holders who are age 50 or older may make catch-up contributions of up to $6,500, for a potential total annual contribution of $26,000. Catch-up payments are additional allowed contributions that help those nearing retirement age to bulk up the account in the years before they will need the funds for regular income.

Employers can also make contributions to a Roth 401(k) by matching employee contributions up to a certain percentage or dollar amount. They can also make elective contributions that don't depend on employee contributions.

For 2020, the limit on employee and employer contributions is $57,000 or 100% of employee compensation, whichever is lower. Workers who are age 50 and over can add a $6,500 catch-up contribution for a total of $63,500.

In 2021, the limit goes up to $58,000, and workers age 50 and over can add a $6,500 catch-up bringing the total to $64,500.

Key Takeaways

  • The Roth 401(k) contribution limit for 2020 and 2021 is $19,500, but those aged 50 or over can also make a catch-up contribution of $6,500.
  • Employers can contribute to employee Roth 401(k)s through a match or elective contributions.
  • Total employee and employer contributions can't exceed $57,000 ($58,000 in 2021) or 100% of employee compensation in 2020, whichever is lower.
  • Depending on your income, you may also be able to contribute to a Roth IRA, which has separate contribution limits and rules than a Roth 401(k).
  • No taxes are due on your withdrawals from a Roth 401(k) in retirement, but after age 72 you must take its required minimum distributions (RMDs).

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

Although the contribution limits are the same for traditional 401(k) plans and their Roth counterparts, technically, a designated Roth 401(k) account is a separate account within your traditional 401(k) that allows for the contribution of after-tax dollars. The elected amount is deducted from your paycheck after income, Social Security, and other applicable taxes are assessed. The contribution doesn't garner you a tax break in the year you make it.

The big advantage of a Roth 401(k) is that no income tax is due on these funds—or their earnings—when they're withdrawn after you retire. A traditional 401(k) works in the opposite way: Savers make their contributions on a pretax basis and pay income tax on the amounts withdrawn once they retire. Neither of these 401(k) accounts imposes income limitations for participation.

When available, savers may use a combination of the Roth 401(k) and the traditional 401(k) to plan for retirement. Splitting your retirement contributions between both kinds of 401(k)s, if you have the option, can help you ease your tax burden in retirement.

If You Have Multiple Roth Accounts

The question for those who also want to have a Roth IRA: Do you meet the income limits for being permitted to have one? As of 2020, the income phase-out for Roth IRA contributions starts at $124,000 for single filers and eligibility ends at $139,000. For those who are married filing jointly (and qualifying widow(er)s) in 2020, that income threshold starts at $196,000 and ends at $206,000.

In 2021, these figures go up. Income phase-out for Roth IRA contributions starts at $125,000 and ends at $140,000 for single filers. For those married filing jointly, plus qualifying widower(er)s, the income phase-out starts at $198,000 and ends at $208,000.

Roth IRA accounts have a separate annual contribution limit of $6,000 for 2020 and 2021, with an additional $1,000 limit for catch-up contributions if you are age 50 or over (for a total of $7,000).

Thus, if you have both a Roth 401(k) plan and a Roth IRA, your total annual contribution for all accounts in 2020 and 2021 has a combined limit of $25,500 ($19,500 Roth 401(k) contribution + $6,000 Roth IRA contribution) or $33,000 if you are 50 or older ($19,500 Roth 401(k) contribution + $6,500 catch-up contribution + $6,000 Roth IRA contribution + $1,000 catch-up contribution).

Additional Rules

Roth 401(k) contributions must be made by the end of the calendar year (the 2021 contribution deadline is Dec. 31, 2021). You have a bit more time with Roth IRA contributions; you must make them by tax day.

Due to the coronavirus pandemic, the IRS has extended the 2020 federal tax filing date for individuals until May 17, 2021, and along with it the contribution deadline for IRAs (traditional and Roth)—versus the previous deadline of April 15, 2021.


As well, given the winter storms that hit Texas, Oklahoma, and Louisiana in February 2021, the IRS has delayed the 2020 federal individual and business tax filing deadline for those states to June 15, 2021. The IRA contribution deadline for those affected by these storms is extended to June 15, 2021.

Five years must pass from your first contribution before you can withdraw from your Roth 401(k) tax-free, and you must also be at least 59½ years old. At age 72, you are required to take minimum distributions from your Roth 401(k), but not from a Roth IRA.