In 2020, an employee has annual gross salary of $86,000, annual taxable income of $43,000 (before retirement contributions) and a flat income tax rate of 23%. He makes an annual tax deferred contribution of 3% to his traditional 401K. The employer matches 50% up to 1% of annual gross salary. How much will this employee have saved in 2020? Include all 2020 401K contributions and tax savings from 2020 401K contributions. Exclude investment earnings.

a. $4,463

b. $4,033

c. $3,440

d. $2,322