Read the following problem: Samantha has been working for her employer for a year and is now eligible to participate in the company’s 401K plan. Her employer explains to her that the 401K plan has a Roth feature, which means that if she defers amounts from her pay to put into the 401K, she can make either traditional contributions or Roth contributions. Which should she do?
Using the research skills you have learned, access CCH AnswerConnect, and research these questions:
What is the tax implication of each option?
What factors should be considered in deciding which option to take?
Can Samantha do both?
What would you advise Samantha to do, and why?
By Thursday, post your findings.
State the issue.
Address each of the questions and include your reasoning for your response.
Provide proper tax research citations in your analysis.