401(k) Contribution — Payroll Definition

401(k) Contribution paystub meaning: Pre-tax retirement savings deducted from your paycheck, reducing your taxable income. Codes: 401K / ROTH401K.

Pre-tax retirement savings deducted from your paycheck, reducing your taxable income.

A 401(k) is an employer-sponsored retirement savings plan. Contributions are deducted from your paycheck BEFORE income taxes are calculated (pre-tax), which lowers your current taxable income. For 2026, the maximum employee contribution is $24,500 ($32,500 for workers 50+). Many employers offer a "match" — for example, dollar-for-dollar up to 4% — which is essentially free money. Roth 401(k) contributions are made after-tax but grow tax-free.

A deduction can be pre-tax, post-tax, voluntary, or required. Its label alone does not establish how it affects taxable wages, so check the plan document, employee election, payroll policy, and year-to-date amount.

When this term appears on a statement, read its label, current amount, year-to-date amount, pay-period context, and any adjacent rate or hours together. Resolve a mismatch with the original issuer or the cited authority rather than changing a record to force a preferred result.