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Financial encyclopediaReviewed 2026-10-23

Roth 401(k) Plan

An employer-sponsored Roth 401(k) plan is similar to a traditional plan with one major exception. Contributions by employees are not tax deferred but are made with after-tax dollars. Income earned on the account from interest, dividends, or capital gains, is tax-free.

Sources and references ↗
PROFILE / FACT FILE

Concept at a glance

Term
Roth 401(k) Plan [1]
Subject area
Investor.gov glossary [1]
Jurisdiction / scope
US regulatory and investor-education context [1]
Primary reference
SEC · Investor.gov [1]

Definition and explanation

An employer-sponsored Roth 401(k) plan is similar to a traditional plan with one major exception. Contributions by employees are not tax deferred but are made with after-tax dollars. Income earned on the account from interest, dividends, or capital gains, is tax-free. [1]

Source-supported connections

Roth 401(k) Plan → Mentioned in the official explanation → 401(k) Plan [1]
Roth 401(k) Plan → Mentioned in the official explanation → Interest [1]

Frequently asked questions

What does Roth 401(k) Plan mean in the cited reference?

An employer-sponsored Roth 401(k) plan is similar to a traditional plan with one major exception. Contributions by employees are not tax deferred but are made with after-tax dollars. Income earned on the account from interest, dividends, or capital gains, is tax-free. [1]

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Roth 401(k) Plan connection map

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Roth 401(k) Plan

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Links retain their source-specific meaning. Award-time affiliations and links to related reading are not claims about current appointments or economic causation.

Sources and review dates

  1. US SEC · Investor.gov — Roth 401(k) Plan ↗

Reviewed 23 October 2026. Historical dates and award-time affiliations retain their original context. A review date is not an event date. Background sources are identified separately from official records.

Content preparation: source-based compilation with AI assistance. See methods and attribution. Named sources identify the underlying records; no individual expert review is claimed.