DCP Roth and Roth IRA – What’s the difference?

Washington’s Deferred Compensation Program (DCP) offers a Roth option in addition to the traditional pretax option many customers contribute to. Here we’ll take a look at questions you’ve asked about the newer Roth option, especially in comparison to a Roth IRA. While DCP is available only through employers, an IRA, or Individual Retirement Account, is a type of account you can set up on your own through a financial vendor.

What is DCP?

A supplemental retirement savings account available to many Washington public employees. More about DCP. If your employer doesn’t offer Washington’s DCP, ask about other available retirement savings accounts.

What is Roth?

With Roth, your contributions are deferred from your already taxed income. Roth withdrawals, including any investment earnings, are not taxed if you meet minimum qualifications. Tax-free requirements include a five-year holding period from the year of your first contribution, and a minimum age of 59½. If you withdraw before meeting these, any investment earnings will be taxed.

Table Comparing DCP Roth and Roth IRA in 2024

FeatureDCP RothRoth IRA
Taxed contributionYesYes
Minimum monthly contribution$30 or 1% earningsVaries
Maximum annual contribution$23,000 (Roth & pretax total)*$7,000
Annual income limits?No limitYes. See below.**
Tax-free withdrawalsAge 59 ½ and 5 years since first contribution
Rolling funds inYes, but not Roth IRAYes

*Customers age 50 and older can contribute more to DCP annually. See limits.

**2024 income limits for Roth IRA: The income phase-out range for taxpayers making contributions to a Roth IRA is between $146,000 and $161,000 for singles and heads of household. For married couples filing jointly, the income phase-out range is between $230,000 and $240,000.


How is DCP Roth different from a Roth IRA?

The main difference is Roth IRA has income limits to participate. DCP Roth does not. DCP Roth also has higher maximum annual contribution limits than a Roth IRA.

Can I contribute to both DCP Roth and a Roth IRA?

Yes. You can contribute to both, and the annual limits for DCP Roth and a Roth IRA are separate.

Does my plan (PERS, SERS, TRS etc.) offer a Roth option?

No. DRS pension plans are all governmental 401(a) plans, which do not allow Roth contributions. Your pension withdrawals will be federally taxed as income when you receive them. 

How do I start DCP Roth contributions?

Existing DCP customers can add Roth through your DCP account. Select your DCP account, manage contributions, update my contributions. Here you can enter pretax or Roth contributions. Or you can contact Voya at 888-327-5596 for assistance.

New customers can enroll in DCP by completing this form.

Have more questions about DCP Roth?

See more about Roth and pretax options.

If you have additional questions, we recommend you consult your financial advisor to determine your retirement planning needs. DRS and the record keeper, Voya, are unable to offer financial advice.

Back to Top