How does a typical vesting timeline work with respect to employer contributions?
There are two dates that matter for vesting in this situation: If you left the company on 12/31/16, you would be entitled to none of the company contributions. If you left on 1/1/17, you would be entitled to all $20k. This is sometimes known as a cliff vesting schedule. Some companies do a stair step - 20% after year 1, 40% after year 2, etc. This is known as graded vesting. But, that is not the case based on the language here.
IRA and 401k are investment accounts. 401k accounts may be limited in what you're allowed to invest in more than the IRA, but still - these are investment accounts. The money you deposit in them - is invested, per your instructions.  What happens to it is up to you. When you leave your job, if you have some unvested match balance in the 401k, it may be refunded back to your employer, but your own contributions are always vested. "typically, your employer will automatically stop making contributions once you hit the 18k$ limit. it is worth noting that employer contributions (e.g. ""matching"") do not count towards the 18k$ employee pre-tax contribution limit. however, if you have 2 employers during the year their combined payroll deductions might exceed the limit if you do not inform your later employer of the contributions you made at your former employer (or they ignore the info). in which case, you must request a refund of ""excess contributions"" from one of the plans (your choice). you must report the refund as taxable income on your taxes. if you do not make this request by the time you file your taxes, the tax man will reject your filing and ""adjust"" your return with more taxes and penalties. sometimes requesting a refund of excess contributions might cause your employer to remove ""matching"" funds, but i am not clear on the rules behind that. there are some 401k plans that allow ""supplemental after-tax contributions"" up to the combined employee/employer limit (53k$ in 2015 and 2016). it is a rare feature, and if your company offers it, you probably already know.  however, generally it is governed by a separate contribution election that only take effect once you hit the employee pre-tax contribution limit (18k$ in 2015 and 2016). you could ask your hr department to be sure. 401k plans can be changed if there is enough employee demand for a rule change.  especially in a small company, simply asking for them to allow dollar based contributions instead of percent based contributions can cause them to change the plan to allow it. similarly, you could request they allow ""supplemental after-tax contributions"", but that might be a harder change to get." Does the 5 year rule apply on the After-tax 401k -> Roth 401k -> Roth   IRA conversion of the 20000 (including 10000 earnings that was   originally pre-tax)? No. The after-tax amounts are not subject to the 5 years rule. The earnings are. How does this affect Roth IRA withdrawal ordering rules with respect   to the taxable portion of a single conversion being withdrawn before   the non-taxable portion? Taxable portion first until exhausted. To better understand how it works, you need to understand the rationale behind the 5-year rule. Consider you have $100K in your IRA (traditional) and you want to take it out. Just withdrawing it would trigger a 10K statutory penalty, on top of the taxes due. But, you can use the backdoor Roth IRA, right? So convert the 100K, and then it becomes after-tax contribution to Roth IRA, and can be withdrawn with no penalty. One form filled ad 10K saved. To block this loophole, here comes the 5 years rule: you cannot withdraw after-tax amounts for at least 5 years without penalty, if the source was taxable conversion. Thus, in order to avoid the 10K penalty in the above situation, you have a 5-year cooling period, which makes the loophole useless for most cases. However amounts that are after tax can be withdrawn without penalty already, even from the traditional IRA, so there's no need in the 5 years cooling period. The withdrawal attribution is in this order: Roth IRA rollovers are sourced to the origin. E.g.: if you converted $100 to the Roth IRA at firm X and then a year later rolled it over to firm Y - it doesn't affect anything and the clock is ticking from the original date of the conversion at firm X. 5-year period applies to each conversion/rollover from a qualified retirement plan (see here). Distributions are applied to the conversions in FIFO order, so in one distribution, depending on the amounts, you may hit several different incoming conversions. The 5 years should be check on each of them, and the penalty applied on the amounts attributable to those that don't have enough time. 5-year period for contributions applies starting from the beginning of the first year of the first contribution that established your Roth IRA plan. The penalty applies to the amounts that were included in your gross income when conversion occurred, i.e.: doesn't apply on the amounts converted from after-tax sources. Note the difference from the traditional IRA - distributions from pre-tax sources are prorated between the non-deductible (basis) amounts and the deductible/earnings amounts (taxable). That is why the taxable amounts are first in the ordering of the distributions. To determine how much you can contribute to a regular and roth IRA you have to calculate your compensation: What Is Compensation?  Generally, compensation is what you earn from   working. For a summary of what compensation does and does not include,   see Table 1-1. Compensation includes all of the items discussed next   (even if you have more than one type).Wages, salaries, etc. Wages,   salaries, tips, professional fees, bonuses, and other amounts you   receive for provid-ing personal services are compensation. The IRS   treats as compensation any amount properly shown in box 1 (Wages,   tips, other compensation) of Form W-2, Wage and Tax Statement,   provided that amount is reduced by any amount properly shown in box 11   (Nonqualified plans). Scholarship and fellowship payments are   compen-sation for IRA purposes only if shown in box 1 of Form   W-2. It a also includes commissions, self-employment income, and alimony an non-taxable combat pay. For most people it is what i in box 1 of the W-2. For the example in the question. If the sum of Box 1's equals $3,200 that is the maximum you can contribute to all your IRAs (regular and Roth). The funds can come from anywhere. It is not related to your net check. The money can be from savings, gifts, parents, grandparents... The IRS doesn't care about the source of the funds, only that you don't over contribute. Of course the calculation is more complex if the person is married, and if they have access to a retirement account. Its important that you carefully read the agreement, if you accept the job. The options agreement will usually specify the vesting schedule, the strike price, and the number of options you will have.  When you start vesting options, you can choose to buy stock at the strike price. When you do exercise the options, your employer will likely withhold state and federal income tax. The strike price will hopefully be well below the market price.  Unlike stock, when your employment ends, you usually are not able to hold on to your options. There's typically a small window of time in which you can exercise your options. You should read this part of the agreement carefully and plan accordingly. For a 401(k), only contributions that you make for the current tax year through payroll deduction are tax-deductible.  Those contributions are subtracted off of your income for your W-2 Box 1 income amount.  If you make a manual contribution to your 401(k) outside of that, it is not tax deductible, and there is nowhere on your Form 1040 to deduct it. Your commuter benefits are also paid for out of payroll deduction and deducted on your W-2, so this is not an option, either. You could contribute to a traditional IRA for last year up to your tax return deadline, and deduct the amount on Form 1040 Line 32.  However, because you have access to a retirement plan at work, your IRA contribution is only tax deductible if your income is below certain limits. "The carry forward refers to the ""annual allowance"", which is a limit on the total pension contributions you can make and still get any tax relief at all.  However, the tax relief itself only applies to the year you make the contribution, and you can't carry the contribution itself back or forward to get relief at a higher marginal rate. So, in scenario (1) you get £2K relief and your provider gets £2K relief. But the actual contribution you should make to your provider is £8K. They'll add in the £2K to make a £10K gross contribution, and then you'll claim back the £2K leaving you having contributed £6K net for the £10K gross contribution. The mechanism whereby the pension provider claims back the £2K is called ""relief at source"". For scenario (2) you'll only get basic rate tax relief on the second £10K, because you'll have already reduced your gross income for the year below the higher-rate threshold with the first £10K. If you managed to make pension contributions in excess of the annual allowance even considering carry-forward, then you'd get no tax relief at all on those contributions. Given that the pension would also get taxed when paid, this is not a good deal and people generally avoid exceeding that limit. For (3) I'm not entirely certain, but I think you can carry forward in the circumstances you describe. I think the principle is simply that you could have paid into a pension scheme. In practice I also don't think HMRC will be worrying too much about this precise detail even if they have the opposite interpretation - it'd be a lot of work to check for not much gain." Obviously, her new employer won't know how much was contributed from   the old job, so this won't work this year. Obviously the new employer would. They will not deposit anything, unless you tell them how much you have deposited already. Somehow tell the new employer how much was contributed by her last   employeer, so they can stop deducting at the right time. I'm not sure   if this is even possible. Why isn't it possible? I've been in a similar situation, the employer had a form to fill on this matter as part of the paperwork for the payroll, right between the direct deposit forms and the 401K contributions form. By the way, another thing to take a look at when switching jobs is the Social Security tax. I wrote about it here.