401(k) Limit Enforcement

Zenefits Payroll monitors the IRS mandated 401(k) contribution limits for your workforce, but what if you have a new hire who contributed to a 401(k) at a previous job? You can now add a worker’s previous 401(k) contributions, so that Zenefits can still monitor their limits. 

How can I enter a limit for a worker? 

  1. Log in to your admin account. 
  2. Click on Payroll
  3. Go to the People tab. 
  4. Click on the worker you’re adding a limit to. 
  5. Scroll down to the Deduction section. 
  6. For a new deduction, click +Add Deduction, select 401(k), and click Add
  7. For an existing deduction, click the pencil icon. 
  8. Confirm the amount to be deducted/contributed per pay run. 
  9. Enter any prior amounts deducted/contributed outside of Zenefits. 
  10. Add any custom annual limits. 
  11. Click Add once finished. 
 If you haven’t set up any 401(k) pay types yet, see this page.

Zenefits notifies you in the pay run if any workers are about to reach, or have reached, their annual 401(k) limit. There are a couple different scenarios in which you’ll see a warning message in the pay run. 

If the worker has already reached the limit, Zenefits will stop deductions moving forward. 

If the worker is nearing the limit, Zenefits will adjust the deduction so they don’t go over, then stop deductions moving forward.  

If Zenefits needs clarification on the deductions, a payroll admin will be asked to edit deductions before approving. 
  • For example, if a worker contributes to both traditional and Roth but their usual deduction will take them over the limit.

If you received an email from Zenefits about reaching your 401(k) limit, no action is required from you. This is just a heads up that you've reached your contribution limit and why your paycheck amounts may vary in the future.

Limits are set on an annual basis, so you can begin contributing again when the new year starts.

Are you over 50 and feel you should be able to do catch-up contributions? Chat with your company's HR personnel.

Still need our help? Our support team is waiting to help you. Contact us