# 401(k) plan

> 401(k) plan — A defined contribution retirement plan in which employees defer part of their pay, pre-tax or Roth, into their own accounts — up to $24,500 for 2026, plus catch-up from age 50 — usually with an employer match. A traditional plan is tested each year for nondiscrimination.

Source: https://lopifi.com/glossary/401-k-plan
Part of: Lopifi — US GAAP books on autopilot, checked by a CPA (https://lopifi.com)

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**What is 401(k) plan?** In accounting, 401(k) plan means a defined contribution retirement plan in which employees defer part of their pay, pre-tax or Roth, into their own accounts — up to $24,500 for 2026, plus catch-up from age 50 — usually with an employer match. A traditional plan is tested each year for nondiscrimination.

## Words this system refuses for it

- pension (a defined benefit plan)
- IRA

- **Category:** Benefits
- **Specified in:** [Lexicon](https://lopifi.com/md/docs/domain/11-lexicon)