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Thanks for the correction on my math. It may be meaningful to the OP to contribute some to the traditional 401k and the remainder to the Roth 401k to balance taxable income and avoid the 22% tax bracket.

Well, a lot of it depends on what the OP earns. Since the OP said I "don't make much" - that leaves it wide open.

If the OP earns more than $19k, they are going to have some income in the 22% bracket, even if the husband contributes all $19k to the pre-tax account. Then, the 22% bracket will be unavoidable.

If the OP will earn less than $19k, then they could contribute up to ($19k minus the OP's income) to the Roth without hitting the 22% bracket. But then, if the husband gets a raise or a bonus, it will push some income into the 22% bracket.

That said, since under current tax law, the rates are scheduled to go back up to the previous rates in 2026, putting money into a Roth account at 22% may not seem like that bad of a deal. Besides, at age 44, already with $1.68MM in liquid assets and, since most ESOPs are pre-tax, having 85% of their assets in pre-tax accounts, and only 15% in Roth accounts, they probably aren't going to be in a low tax bracket when they hit RMD age, so putting more money in the Roth account, even at 22%, is likely to end up being a good deal.

Again, to the OP: Having over 1/3 of your liquid assets in your husband's employer's stock is a pretty big risk, looking at what has happened to companies like Enron or, more recently, GE. If some of the stock can be sold, you may want to consider doing that - especially if you can sell specific lots with a higher cost basis. Then, if your husband has a relatively low basis in that stock, I would strongly urge that when he leaves the company that you look at using the NUA treatment, even if he's under 59 1/2. While you would pay a 10% penalty on the basis, and you may have to sell some of the stock to cover the tax bill, it would do 2 things for you:

- Get some of the money out of the traditional accounts and into a taxable account with a relatively low cost in taxes (this would work especially well if your husband leaves the company in time to move the money out of the ESOP under the current tax law)

- Get the money into an account that you would have more control over when and at what price to sell, since ESOPs often have some constraints on selling

Here is an article that gives a pretty good explanation of the NUA rules:

Also, if unclear from my earlier post, depending on how the employers contribution is calculated, OP may be better off ensuring they capture the match.

Yes, it's always important to capture as much match as possible. However, since the OP said in the original post We currently fully fund his regular 401k, and it is typically matched 15% at the end of the year, it doesn't appear that the timing is a big deal on the match. But if the company does match based on 15% of what was contributed, rather than, say 100% of the first 15% of the salary, it would be important to make the whole $19k contribution for 2019.

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