|
Your pre-tax 401(k)
contributions are deducted from your pay before federal income taxes are withheld. You
don't pay federal taxes on this money until you withdraw it from your 401(k) account.
However, you are required to pay Social Security tax on all 401(k) contributions.
As for state income tax, most states exempt 401(k) contributions from taxation, but
depending on where you live your contributions may be subject to local income taxes.
You should check with your company's Human Resources or Benefits representative regarding
the laws in your area. |
|
