401k rules and limits multiple employers

Submitted by Uli Bittenbinder on Fri, 2023-06-16 16:33

If you have two different employers and 401k plans can you go above the limit of $73,500? I know you cannot exceed the employee deferral of 30k (age 50+) but could each individual employer add $43,500. Or are the employer contributions maxed at 43,500?

Company one add $30k deferral + $43,500 company profit sharing

Company two add $43,500 (20% of gross Income to 401k PA)



Submitted by Sunil Veluvali on Fri, 2023-06-16 16:40

No, the combination of all contributions from you and your employer for a given year cannot exceed the maximum allowed for that year. 

Submitted by David Mertz on Fri, 2023-06-16 19:41

  • For someone age 50 or over, the $30,000 elective deferral limit is a per-individual limit.  The section 415(c) limit of $73,500 is a per-plan limit that includes employer contributions.  For an individual with sufficient compensation, it’s possible for someone with two unrelated employers to have 401(k) additions totaling $147,000, $30,000 of elective deferrals plus $43,500 of employer contributions at one employer and $73,500 of employer contributions (but no elective deferrals) at the other employer.  Employer contributions of $73,500 would require having at least $294,000 of compensation at that employer.  For 2023, a maximum of $330,000 of compensation is taken into account at any one employer.
  • If self-employed, the maximum employer contribution from the self-employment business would be $66,000, requiring $330,000 of net earnings from self-employment.  Under these circumstances it would probably make sense to maximize the elective deferrals at the self-employment business rather than at the other, non-self-employment business.
  • If the businesses are a controlled or affiliated service group due to ownership characteristics, they are treated as a single employer for the purpose of a retirement plan.
  • https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-401k-and-profit-sharing-plan-contribution-limits

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