What is the 401k contribution limit in Tennessee for 2026?
The 2026 IRS employee deferral limit is $24,500, plus $8,000 catch-up for those age 50 and over ($32,500 total). Tennessee follows the same federal retirement plan limits as other states.
401k Calculator Tennessee 2026
Tennessee workers can defer up to $24,500 to a 401k in 2026 ($32,500 with the $8,000 catch-up at age 50+). Tennessee does not tax wages at the state level, so 401k decisions hinge on federal taxes, a typical 3–6% employer match, and optional Roth 401k for after-tax federally tax-free growth.
401(k) and IRA projections update as you type — educational only.
Tennessee: no state tax on wages — federal 401(k) rules apply. Not financial or tax advice.
IRS cap $24,500/yr
Simplified model: 100% match up to this % of salary. Actual employer formulas vary (e.g. 50% up to 6%, tiered match, etc.)
Your contributions grow as your salary grows.
Projected balance
$1,472,304
Your contributions$344,829
Employer match$103,449
Investment growth$999,027
Monthly at retirement (4% rule)$4,908
Years to retirement30
The 4% rule is a general guideline, not a guarantee. This is not financial advice.
Balance breakdown (stacked)
Your contributionsEmployer matchGrowth
401k Contribution Limits 2026
| Type | 2026 Limit | Notes |
|---|---|---|
| Employee contribution | $24,500 | IRS |
| Catch-up (age 50+) | +$8,000 | Total $32,500 |
| Catch-up (age 60–63, if eligible) | +$11,250 | Federal |
| Total with employer match | Up to $72,000 | Combined |
Tennessee 401k Tax Treatment — No State Tax on Wages
Pre-tax 401k deferrals reduce federal taxable income; Tennessee does not layer a wage income tax. Plan around federal brackets, employer match tiers, and Roth vs traditional using federal projections.
401k Savings Growth Example (Tennessee)
| Monthly Contribution | Years | 7% Return | Est. Balance |
|---|---|---|---|
| $500 | 20 | 7% | ~$262,000 |
| $1,000 | 20 | 7% | ~$524,000 |
| $2,042 ($24,500/yr) | 20 | 7% | ~$1,071,000 |
| $2,042 ($24,500/yr) | 30 | 7% | ~$2,467,000 |
Tennessee Traditional vs Roth 401k 2026
Without Tennessee wage tax, Roth 401k vs traditional is a federal timing bet. Many employees still default to traditional to capture the match and lower current federal tax, then add Roth if the plan allows.
Frequently Asked Questions
Does Tennessee tax 401k contributions?
Tennessee does not tax earned income at the state level (the former Hall income tax on dividends and interest was repealed). There is no Tennessee wage tax on 401k deferrals; you still receive federal pre-tax treatment on traditional contributions.
What is a typical employer 401k match in Tennessee?
Manufacturing, healthcare, and logistics employers commonly match about 3% to 6% of pay when you defer enough. Prioritize earning the full match before other investments.
Traditional or Roth 401k in Tennessee?
With no state tax on wages, evaluate using federal taxes: traditional lowers federal taxable income now; Roth 401k trades current federal tax for qualified tax-free withdrawals.
Can I deduct 401k on Tennessee state taxes?
Tennessee does not impose a broad income tax on wages, so there is no state deduction line for 401k — plan using federal rules.
Is Roth 401k offered in Tennessee?
Many employers nationwide, including in Tennessee, now offer Roth 401k. After-tax contributions can produce federally tax-free qualified distributions; confirm with your plan.
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Educational estimates only. Not financial or tax advice.