Question

1. Increasing your 401k deduction will ________ your gross pay and __________your federal taxes in the current year.

Answer 1

Not Change, Decrease

Step-by-step explanation:

The contribution to the 401k plan decrease the tax liability at the end of the period and also the tax withholding for each pay year. Though, the individual do not take the tax deduction on the income tax return from 401k plan.

By increasing the 401k deduction will have no impact on the gross pay and will decrease the federal taxes of the current year.