When you convert after-tax balances to Roth, no taxes would be due on the conversion of your contributions. There are a couple of different ways to accomplish that, including rolling over your balances to an IRA or doing an in-plan conversion if it's offered by your employer along with a Roth option. You could then go a step further and convert your after-tax contributions to a Roth account. That's a powerful benefit on its own-but that's not the end of the story. Making after-tax contributions allows you to invest more money with the potential for tax-deferred growth. Potential strategies for after-tax 401(k) contributions Distributions may or may not be subject to state taxation. Employer nonelective contributions, typically profit sharing.What your employer can contribute on your behalf After-tax contributions to your workplace savings plan (if allowed by your employer).Elective deferrals (either tax-deferred, Roth, or a combination): Up to $20,500 in 2022 ($27,000 including catch-up).The IRS allows a total of up to $61,000 to be saved in a 401(k) for 2022 ($67,500 including catch-up contributions for people age 50 and over). Check with your plan administrator if the rules seem unclear. After-tax contributions can be made at the same time as your regular contributions. One quick note about after-tax contributions-you may not have to wait until you’ve hit the annual contribution limit during the year to make them. These are different than Roth contributions to your workplace savings plan. Once you see that you will max out these contributions, you may want to consider making after-tax contributions as well. There are no income caps on Roth contributions in a workplace savings account like a 401(k). In 2022 you can save up to $20,500 in a tax-deferred or Roth workplace savings account* and if you're turning age 50 during the year, you can save $27,000 which includes $6,500 in catch-up contributions. You may be able to save more than you think-for many people, the annual contribution limit isn't the end of their tax-advantaged saving opportunities. After all, saving money is great but saving in a tax-advantaged account is even better. You already know about the benefits of saving in your workplace savings plan, like a 401(k). After converting to a Roth, earnings can grow and be distributed tax-free if certain requirements are met. Converting after-tax 401(k) contributions to a Roth account is an option.

Earnings on after-tax contributions are considered pre-tax and would grow tax-deferred until withdrawals begin.After contributing up to the annual limit in your 401(k), you may be able to save even more on an after-tax basis.

Max 401k contribution 2021