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Old 12-23-2018, 04:37 AM   #1  
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Default 2019 401k Questions

Reviving this old thread for 2019.

Can someone explain to me the tax treatment for the defined contribution plan/B Fund/401(k)? The 2019 limit for a 401(k) is $19,000/yr and obviously most airline pilots will easily eclipse this. My main three questions are this:

1) What is the proper term for the account where these automatically contributed retirement funds go?

2) Is the account tax-sheltered like a 401(k) or considered after-tax?

3) If the account is a 401(k), can it all be treated as pre-tax money even if it exceeds the $19K annual limit set by the IRS?
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Old 12-23-2018, 07:32 AM   #2  
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Originally Posted by Techsan15 View Post
Reviving this old thread for 2019.

Can someone explain to me the tax treatment for the defined contribution plan/B Fund/401(k)? The 2019 limit for a 401(k) is $19,000/yr and obviously most airline pilots will easily eclipse this. My main three questions are this:

1) What is the proper term for the account where these automatically contributed retirement funds go?

2) Is the account tax-sheltered like a 401(k) or considered after-tax?

3) If the account is a 401(k), can it all be treated as pre-tax money even if it exceeds the $19K annual limit set by the IRS?
It's a 401k, but the employer can make Direct Contributions (match or just an unmatched contribution) above the $19K limit.

Age 50+ can do "catch up" employee deferrals of an additional $6K above the $19K.

There's a total limit of $55k for all employee + employer contributions.


Most or all better majors today do a 15-16% contribution (no match required). So many major airline pilots max out the 401k total cap just from the employer DC.
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Old 12-23-2018, 10:02 AM   #3  
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Why not just start a new thread?
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Old 12-24-2018, 03:55 AM   #4  
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Most or all better majors today do a 15-16% contribution (no match required). So many major airline pilots max out the 401k total cap just from the employer DC.
What happens to the extra contributions above 55K? Is that simply the max the company will contribute or does it get distributed to an after-tax account instead?
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Old 12-24-2018, 12:27 PM   #5  
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What happens to the extra contributions above 55K? Is that simply the max the company will contribute or does it get distributed to an after-tax account instead?
Distributed as ordinary income at Delta. You can do anything you like with it since itís post tax money.
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Old 12-25-2018, 09:35 AM   #6  
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What happens to the extra contributions above 55K? Is that simply the max the company will contribute or does it get distributed to an after-tax account instead?
At United, excess company contributions to the Pilotís DC fund go into the individuals RHA account. This can be significant.
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Old 12-28-2018, 01:52 PM   #7  
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Can I invest my Roth 401K money into the same mutual funds that the company puts my traditional 401k money in, or do I need to choose different funds?
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Old 01-02-2019, 10:56 AM   #8  
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Can I invest my Roth 401K money into the same mutual funds that the company puts my traditional 401k money in, or do I need to choose different funds?
At my company it is in the same funds and there should be a web page that shows the breakdown of 401k vs roth401k contributions.
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Old 01-02-2019, 02:45 PM   #9  
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At my company it is in the same funds and there should be a web page that shows the breakdown of 401k vs roth401k contributions.
Thank you!
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