Roth vs Traditional 401(k) Paycheck Impact
A $500 traditional 401(k) deferral costs about $390 of take-home. Roth costs the full $500. Here's the per-paycheck math, FICA, and state tax.
This article is general information, not tax or financial advice. Tax rules change, individual situations vary, and every figure here is an estimate. Confirm specifics with a qualified tax professional before making money decisions.
Same $500, two very different paycheck lines
Put $500 per paycheck into a traditional 401(k) in the 22% federal bracket and your take-home drops by about $390. Put the same $500 into a Roth 401(k) and your take-home drops by the full $500.
That is a $110 gap per check. On a biweekly schedule (26 checks) it is $2,860 a year. Semimonthly (24 checks), $2,640.
That gap is the whole difference between the two buckets. Traditional deferrals leave your wages before income tax is figured, so you keep the tax you would have owed. Roth deferrals are taxed on the way in and never again after that, assuming a qualified withdrawal.
If that derivation is new to you, read how a 401(k) contribution affects your take-home pay first. This piece picks up where that one stops, at the actual decision.
| Line | Traditional | Roth |
|---|---|---|
| Amount into the account | $500.00 | $500.00 |
| Federal income tax avoided (22%) | $110.00 | $0.00 |
| FICA withheld on the $500 (7.65%) | $38.25 | $38.25 |
| Take-home reduction | $390.00 | $500.00 |
One caveat on the shortcut: multiplying by (1 minus your marginal rate) assumes the whole deferral sits inside a single bracket. A large deferral that straddles a bracket boundary saves at a blended rate, so the real reduction lands a little above what the shortcut predicts.
FICA comes out either way, and that surprises people
Look at the FICA row again. It is the same number in both columns, and it does not move no matter which box you tick on the enrollment screen.
$500 times 7.65% is $38.25, withheld for Social Security and Medicare, whichever election you make. The IRS is explicit that traditional elective deferrals, though not treated as current income for federal income tax, are “included as wages subject to social security (FICA), Medicare, and federal unemployment taxes (FUTA).” Designated Roth contributions are subject to income tax withholding and FICA both.
People trip over this constantly when they estimate the traditional savings. They add 22% plus 7.65% and expect a $351.75 hit. But the payroll tax is already gone before the income tax question is even asked, so only the 22% is in play.
You can confirm it on your own W-2 next January. Box 12 code D is a traditional 401(k) deferral, and code AA is a designated Roth contribution. Traditional deferrals reduce Box 1 only; Roth contributions get reported in Boxes 1, 3, and 5. Our guide to pay stub codes walks through the rest of the alphabet soup.
So of everything on your stub, the payroll tax line is the one thing this decision never touches.
The state tax wrinkle
That $110 gap is a federal-only number. Where you live usually widens it, but in ten states it does not move at all.
Most states follow the federal treatment: a traditional deferral lowers your state taxable wages too. At a 5% state marginal rate, the traditional deferral costs $365 instead of $390, and the gap against Roth opens to $135 per check, or $3,510 a year biweekly.
Where you live puts you in one of three situations.
Most states. Traditional buys you a federal break plus a state break, so the case for traditional is stronger than the federal math alone suggests.
The nine states with no broad income tax (Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, Wyoming). There is no state break to forgo, so the gap stays at the federal $110. If you are weighing a move, our comparison of no-income-tax states against high-tax states covers the broader picture.
Pennsylvania. PA taxes elective deferrals in the year you make them. Employee contributions to a qualified deferred compensation plan are listed as always taxable as Pennsylvania compensation, so at the 3.07% flat rate the state collects $15.35 on that $500 no matter which election you pick. A Pennsylvania resident gets no state-level reason to prefer traditional.
New Jersey is the mirror image, and it catches people. NJ does exclude 401(k) deferrals from wages, but it “does not allow you to exclude from wages amounts you contribute to deferred compensation and retirement plans, other than 401(k) Plans.” A New Jersey teacher deferring into a 403(b) is in Pennsylvania’s position, not a 401(k) saver’s.
Equal contribution or equal paycheck? Pick the question first
Almost every comparison you will find online runs $500 traditional against $500 Roth. That answers a real question, but probably not the one you are asking at the enrollment screen.
Equal contribution ($500 vs $500) is the retirement-value comparison. Same money into the account, Roth costs $110 more per check today, and Roth’s $500 arrives with no tax bill attached later.
Equal paycheck ($500 traditional vs $390 Roth) is the budget comparison. Both elections leave the same $390 hole in your check. Over 26 checks that is $13,000 into a traditional account versus $10,140 into a Roth. Less money in, but none of it is owed to anyone.
Which framing you want depends on the constraint you are actually under. If your budget sets the ceiling, the second one is your comparison, and picking Roth means dialing the percentage down to keep the check whole.
Then there is the limit, which quietly favors Roth for anyone who can afford it. The 2026 elective deferral cap is $24,500, and it applies to traditional and Roth combined. A maxed Roth account is $24,500 that never owes income tax again. A maxed traditional account is $24,500 with a bill attached. Same statutory cap, more after-tax value in the Roth version.
The cost of getting there is real, though. Maxing traditional at 22% costs $19,110 of take-home across the year. Maxing Roth costs the full $24,500. That is a $5,390 difference, about $207 per biweekly check.
One note on the match: it does not change any of this arithmetic. Employer contributions land pre-tax by default, and a plan-optional Roth match is taxable to you in the year it is made rather than withheld from your check.
The break-even is a rate bet, but the paycheck isn’t
The traditional-versus-Roth question comes down to one comparison. Traditional wins if your marginal rate when you withdraw is lower than your rate today. Roth wins if it is higher. If the two rates are equal, the outcome is a mathematical wash, assuming you actually invest the tax savings traditional hands you. The Bogleheads wiki has the cleanest neutral write-up of that identity if you want the algebra.
Nobody knows their 2050 bracket, which makes that framing hard to act on. You do not know your future income, your future state, or what Congress does to the rate schedule between now and then.
What you can know today is whether $500 or $390 is the number your budget survives. That one is a line on a stub you can check this month.
So contribute what you can sustain. And remember that a split is a legitimate answer, since most plans let you set a percentage to each bucket and adjust it later. If marginal rates are the part that feels slippery, our piece on whether a raise pushes you into a higher bracket explains how the schedule actually works. One 2026 rule to flag: if your prior-year FICA wages topped $150,000, your catch-up contributions have to be Roth regardless of what you would have chosen.
Run your own two lines
Every number here uses a single filer in the 22% bracket. Your bracket, your state, and the rest of your deductions all move the answer, and they stack in ways that are annoying to do by hand.
Start with the 401(k) paycheck impact calculator, which handles both traditional and Roth elections and shows the arithmetic instead of just an output number.
For the side-by-side, Salary Calculator (Stub44) treats traditional and Roth 401(k) as separate deduction types and runs full federal, state, and FICA math for all 50 states plus DC. Save two profiles, one traditional and one Roth at the same dollar amount, and read the net pay difference directly.
Then run the equal-paycheck version too: set the Roth profile to whatever amount lands on the same take-home. That second number is the one your budget is really choosing between. You can download the app and have both profiles built in a couple of minutes.
Frequently Asked Questions
Does a Roth 401(k) reduce take-home pay more than a traditional 401(k)?
Yes. A Roth contribution comes out after tax, so your check drops by the full amount. A $500 Roth deferral costs $500 of take-home, while the same $500 traditional deferral costs about $390 in the 22% bracket, because you keep the income tax you would have paid.
Is a Roth 401(k) contribution pre-tax or after-tax?
After-tax. The IRS treats designated Roth contributions as taxable income in the year you defer them, and they stay in Box 1 of your W-2. Traditional deferrals are pre-tax and are left out of Box 1.
How much does a 10% Roth contribution cut my paycheck?
By the full 10% of the pay it is calculated on. On a $3,000 biweekly gross, a 10% Roth election takes $300 off the check. The same 10% traditional election would cost about $234 in the 22% bracket.
Do Roth 401(k) contributions still pay Social Security and Medicare tax?
Yes, and so do traditional ones. Both are FICA wages, so 7.65% comes out either way, which is $38.25 on a $500 deferral. The Roth or traditional choice never changes the payroll tax line on your stub.
Does a Roth 401(k) cost more if I live in a state with income tax?
Usually yes. Most states follow the federal treatment, so a traditional deferral also lowers your state taxable wages and the gap between the two elections widens. In the nine states with no income tax, and in Pennsylvania, which taxes deferrals when you make them, there is no state break to give up.
Should I split contributions between Roth and traditional?
Most plans let you, and it is a reasonable answer when you cannot confidently forecast your retirement bracket. A split also lets you dial the paycheck impact: shifting part of the election to traditional raises your take-home without lowering the total going into the plan.
What is the 2026 401(k) contribution limit, and does it cover both types?
$24,500 for employee deferrals in 2026, and it is a combined cap, so traditional and Roth contributions count against the same limit. Catch-up adds $8,000 at age 50 and older, or $11,250 at ages 60 to 63.
Is my employer match Roth or traditional?
By default the match goes in pre-tax, even when your own contributions are Roth. Some plans now offer a Roth match, and if you elect it the match is taxable income to you in the year it is made, but it is not withheld from your paycheck either way.