What is the difference between contributing to a 401k before tax versus after tax?

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1162329

2026-07-12 15:15

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Contributing to a 401k before tax means the money is taken out of your paycheck before taxes are deducted, reducing your taxable income. Contributing after tax means the money is taken out after taxes are deducted, so you pay taxes on that money now but may not have to pay taxes on it when you withdraw it in retirement.

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