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Maximizing 401k, how to calculate limits
Old 11-08-2004, 06:34 PM   #1
 
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Maximizing 401k, how to calculate limits

How to calculate the of 401k 13K limit. If the moeny is deducted on 31st dec-03 and credited on 5th Jan04. This money will count towards 2003 limit or 2004 limit? Thanx
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Re: Maximizing 401k, how to calculate limits
Old 11-08-2004, 08:29 PM   #2
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Re: Maximizing 401k, how to calculate limits

The only way to know for sure would be to contact your payroll department or person and ask them.

I know in my case I am paid on the 15th and the last of the month, and my December 31ish 401(k) contribution counts towards the earlier of the two years.

malakito.
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Re: Maximizing 401k, how to calculate limits
Old 11-13-2004, 03:25 PM   #3
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Re: Maximizing 401k, how to calculate limits

Follow your W-2. In my job the first paycheck on mine is any money I RECEIVED in the year even if it is for work in the previous year. The last pay on my W-2 is the last money I received before Jan 1 of the next year. For my 401k, the same is true in the accounting on my paystub. I guess the IRS only cares when you got the money and not when you earned it.
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Re: Maximizing 401k, how to calculate limits
Old 11-13-2004, 03:31 PM   #4
 
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Re: Maximizing 401k, how to calculate limits

Re. "I guess the IRS only cares when you got the money", this is generally true for "cash basis taxpayers"
and probably completely accurate in the context of your post. However, I regret to inform you that there are
many exceptions to what would appear a simple rule.

John Galt
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