Help needed with contribution limits

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buddingdr
Posts: 3
Joined: Thu Dec 06, 2018 10:01 am

Help needed with contribution limits

Post by buddingdr » Thu Dec 06, 2018 10:14 am

I am currently working in a hospital and have another appointment through the university. So, I have 2 jobs with the hospital one being the main job. The hospital side has a 6% match into a 401a (hospital contributes to 401a and 6% of my salary is mandatory into a 403b). I was told I can have a separate elective 403b with $19000 limit from next year.

In addition, the university also has a 401a and part of the university salary gets matched into that 401a as well. The University portion is not much, maybe about 3600 per year (1800 each from me and university). I was told I can open a separate 457b through the university and can contribute another $19000 in it.

My question is about the annual limit of $56000. Does that include both jobs or is it per employer? If I do the backdoor Roth IRA of $5500, does it count towards that annual limit?

Sorry for the long post. Neither my employer's HR office nor TIAA could guide me on this.
Thanks in advance.

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David Jay
Posts: 5791
Joined: Mon Mar 30, 2015 5:54 am
Location: Michigan

Re: Help needed with contribution limits

Post by David Jay » Thu Dec 06, 2018 11:57 am

Welcome to the forum!
buddingdr wrote:
Thu Dec 06, 2018 10:14 am
If I do the backdoor Roth IRA of $5500, does it count towards that annual limit?
Let me take this one. An after-tax contribution to an IRA is always allowed and does not contribute to any cap. You may do one (and then convert to Roth) regardless of other retirement contributions. You can do two ($11,000) if you are married, even with just one income.

Some details in this post: viewtopic.php?f=1&t=265061#p4234279
Prediction is very difficult, especially about the future - Niels Bohr | To get the "risk premium", you really do have to take the risk - nisiprius

megabad
Posts: 828
Joined: Fri Jun 01, 2018 4:00 pm

Re: Help needed with contribution limits

Post by megabad » Thu Dec 06, 2018 12:31 pm

buddingdr wrote:
Thu Dec 06, 2018 10:14 am
I am currently working in a hospital and have another appointment through the university. So, I have 2 jobs with the hospital one being the main job. The hospital side has a 6% match into a 401a (hospital contributes to 401a and 6% of my salary is mandatory into a 403b). I was told I can have a separate elective 403b with $19000 limit from next year.

In addition, the university also has a 401a and part of the university salary gets matched into that 401a as well. The University portion is not much, maybe about 3600 per year (1800 each from me and university). I was told I can open a separate 457b through the university and can contribute another $19000 in it.

My question is about the annual limit of $56000. Does that include both jobs or is it per employer? If I do the backdoor Roth IRA of $5500, does it count towards that annual limit?

Sorry for the long post. Neither my employer's HR office nor TIAA could guide me on this.
Thanks in advance.
For 2019:
1) *Total contributions to hospital 401a and university 401a not greater than 56,000 combined.
2) Total contributions to hospital 403b not greater than 56,000.
3) Total contributions to university 457 not greater than 19k, or 25k w/catchup, or maybe more within 3 yrs of retirement
4) IRA limit 6k.

*Note: I assume 401a contributions are mandatory, not elective. This is usually the case.

Edit: corrected 457 mistake.
Last edited by megabad on Thu Dec 06, 2018 2:14 pm, edited 1 time in total.

buddingdr
Posts: 3
Joined: Thu Dec 06, 2018 10:01 am

Re: Help needed with contribution limits

Post by buddingdr » Thu Dec 06, 2018 1:42 pm

David Jay wrote:
Thu Dec 06, 2018 11:57 am
Welcome to the forum!
buddingdr wrote:
Thu Dec 06, 2018 10:14 am
If I do the backdoor Roth IRA of $5500, does it count towards that annual limit?
Let me take this one. An after-tax contribution to an IRA is always allowed and does not contribute to any cap. You may do one (and then convert to Roth) regardless of other retirement contributions. You can do two ($11,000) if you are married, even with just one income.

Some details in this post: viewtopic.php?f=1&t=265061#p4234279
Thanks for your input. If I had to choose between $5000 in the Roth IRA (backdoor) vs $5000 in the 457b plan (assuming not maxed at $19000), which would be better?

buddingdr
Posts: 3
Joined: Thu Dec 06, 2018 10:01 am

Re: Help needed with contribution limits

Post by buddingdr » Thu Dec 06, 2018 1:48 pm

megabad wrote:
Thu Dec 06, 2018 12:31 pm
For 2019:
1) *Total contributions to hospital 401a and university 401a not greater than 56,000 combined.
2) Total contributions to hospital 403b not greater than 56,000.
3) Total contributions to university 457 not greater than 56,000.
4) IRA limit 6k.

*Note: I assume 401a contributions are mandatory, not elective. This is usually the case.
Thanks for your reply.
https://www.irs.gov/retirement-plans/pl ... ion-limits
This mentions that 457b limit is 19,000 with an exemption to contribute 38,000 if within 3 years of retirement.

So, from what I understand the 401a and 403b plans do not get aggregated towards the limit of $56,000. One other question, though I have 2 separate 401a plans (1 from each employer), would they still aggregate towards the limit of 56,000?

I also came across this other thread which has good information as well. viewtopic.php?t=209491

megabad
Posts: 828
Joined: Fri Jun 01, 2018 4:00 pm

Re: Help needed with contribution limits

Post by megabad » Thu Dec 06, 2018 2:13 pm

buddingdr wrote:
Thu Dec 06, 2018 1:48 pm
megabad wrote:
Thu Dec 06, 2018 12:31 pm
For 2019:
1) *Total contributions to hospital 401a and university 401a not greater than 56,000 combined.
2) Total contributions to hospital 403b not greater than 56,000.
3) Total contributions to university 457 not greater than 56,000.
4) IRA limit 6k.

*Note: I assume 401a contributions are mandatory, not elective. This is usually the case.
Thanks for your reply.
https://www.irs.gov/retirement-plans/pl ... ion-limits
This mentions that 457b limit is 19,000 with an exemption to contribute 38,000 if within 3 years of retirement.
Oops yes, I will edit. The answer is actually more complicated but what I posted was incorrect. max 19k or max 25k with catchup or maybe a higher amount if within 3 years of retirement.

So, from what I understand the 401a and 403b plans do not get aggregated towards the limit of $56,000. One other question, though I have 2 separate 401a plans (1 from each employer), would they still aggregate towards the limit of 56,000?
yes that is my understanding. 401k and 401a accounts are aggregated across employers to my knowledge. so you could only put in 56k combined (not 108k).

I also came across this other thread which has good information as well. viewtopic.php?t=209491

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