After-tax 401k contributions to 2 separate employer based 401k plans

[khushibahut]

Hi
I've changed jobs recently and had contributed to my previous employers 401k plan via pre-tax $ and after tax $s as well which I've converted to Roth IRA via in-plan conversion and mega back door. With my previous employer I got to around 12k in pre-tax employee contributions, 6k employer match and ~30k in after tax 401k contributions. My new employer also allows after-tax 401k contributions but no employer match. I'm hoping to re-do the Mega backdoor here again and have Couple of questions based on that

1) My understanding is that the 19.5k limit on pre-tax employee contributions is across all 401k plans in the year. So since I have 12k with employer 1, I can only do an addition 7.5k with employer 2.

2) With employer 1 my total contributions to 401k came out to 12+6+30 = 48k. Does the 58k contribution limit also apply across all 401k plans in a given year as well? So in my case, with an additional 7.5k in pre-tax (and no employer match) can I only do an addition 2.5k towards employer 2 after-tax 401k plan? Or is that 58k limit for each employers 401k plan. So in my case with a 7.5k in pre-tax contributions with employer 2, I can now do up to an additional 50.5k in after tax 401k contribution which would be great!?

The IRS bulletin on this sort of says each 401k plan has its own aggregate limit, but the example isn't exactly same as mine so trying to confirm from others experiences and understanding of this provision - https://www.irs.gov/retirement-plans/pl ... ion-limits

Example 1: In 2020, Greg, 46, is employed by an employer with a 401(k) plan, and he also works as an independent contractor for an unrelated business and sets up a solo 401(k). Greg contributes the maximum amount to his employer’s 401(k) plan for 2020, $19,500. He would also like to contribute the maximum amount to his solo 401(k) plan. He is not able to make further elective deferrals to his solo 401(k) plan because he has already contributed his personal maximum, $19,500. He would also like to contribute the maximum amount to his solo 401(k) plan.

Greg is not able to make further elective salary deferrals to his solo 401(k) plan because he has already contributed his personal maximum, $19,500, to his employer’s plan. However, he has enough earned income from his business to contribute the overall maximum for the year, $57,000. Greg can make a nonelective contribution of $57,000 to his solo 401(k) plan. This $57,000 limit is not reduced by the elective deferrals Greg made under his employer’s plan because the limit on annual additions applies to each plan separately.

[Duckie]

khushibahut, welcome to the forum.

My understanding is that the 19.5k limit on pre-tax employee contributions is across all 401k plans in the year. So since I have 12k with employer 1, I can only do an addition 7.5k with employer 2.

Correct.

With employer 1 my total contributions to 401k came out to 12+6+30 = 48k. Does the 58k contribution limit also apply across all 401k plans in a given year as well?

No. Unless the two employers have a related employer relationship (controlled group or affiliated service group) the two 401k plans each have a $58K limit.

So in my case with a 7.5k in pre-tax contributions with employer 2, I can now do up to an additional 50.5k in after tax 401k contribution which would be great!?

You can. Make sure the new plan allows not only after-tax contributions but also in-plan rollovers to a Roth 401k and/or in-service rollovers to a Roth IRA. Some plans allow the after-tax contributions but not the rollovers.