I earn $145K and have $100K in long-term capital gains. I’m currently maxing out my 401(k) for tax savings, but I’m on a visa and may not stay in the U.S. long-term. I’ve already contributed $20K to my 401(k). Should I stop contributing now or increase it to the full $23,500? What are the tax benefits of continuing 401(k) contributions compared to the taxes I might owe if I withdraw early when I move back to my home country?
Advice on 401(k) Contributions and Early Withdrawal for Visa Holders
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Posted by No-Examination4175
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This might help:
[How Are 401(k) Withdrawals Taxed for Non-Residents?](https://www.investopedia.com/articles/personal-finance/100515/how-are-401k-withdrawals-taxed-nonresidents.asp)
Basically, you’ll have to keep your money in 401k/IRA or pay the 10% penalty for withdrawal on top of your taxes. However, if you don’t have US income, you might be able to withdraw a small amount (pay 10% penalty) but zero income tax (for income /distribution less than $11925)