Solo 401(k) Contribution Calculator 2026 (Self-Employed 401k)

For Reference Only

These figures are estimates based on standard formulas. Your actual numbers will depend on your lender, location, credit profile, and current market rates. Always confirm with a licensed professional before making financial decisions.

Calculation Results

Max Total Contribution
$41,470
Employee (Salary Deferral)
$23,000
Employer (Profit Sharing)
$18,470

Put This Number to Work

A calculator result is only useful if you act on it. Use these figures as a baseline — then compare them against real loan offers, run different scenarios, and see how small changes in rate or term shift your total cost significantly.

Trying to maximize your retirement savings as a business owner? A Solo 401(k)—also known as a solo k or self-employed 401(k)—offers the highest contribution limits of any individual retirement plan. Use our solo 401k contribution calculator to determine your exact maximum allowable contribution for 2026 based on your business structure and net compensation.

🧮 How Self-Employed 401(k) Limits Work

Because you are both the employee and the employer in your solo k plan, you get to contribute in two separate ways:

  1. Employee Elective Deferrals: For 2026, you can contribute up to $24,500 as an employee (or up to $32,500 if you are age 50+, and $35,750 for ages 60-63).
  2. Employer Profit-Sharing: As the business owner, you can contribute an additional 20% of your net earnings (if you're a sole proprietor) or 25% of your W-2 compensation (if you're an S-Corp).

The combined total across both contribution types cannot exceed $72,000 for 2026 (not counting age 50+ catch-up contributions).

Example: Sole Proprietor vs. S-Corp Contributions

Let's assume you have $100,000 in net business income and you are under 50.

  • As a Sole Proprietor: Your net adjusted self-employment income (after deducting half of SE tax) is roughly $92,935.
    • Employee deferral: $24,500
    • Employer contribution (20%): $18,587
    • Total Solo 401k Contribution: $43,087
  • As an S-Corp Owner (taking a $100,000 W-2 salary):
    • Employee deferral: $24,500
    • Employer contribution (25% of salary): $25,000
    • Total Solo 401k Contribution: $49,500

👤 Who Should Use This Calculator?

  • Freelancers, consultants, and independent contractors earning income on a 1099 basis
  • Sole proprietors who file a Schedule C and have no full-time W-2 employees
  • Business owners who have structured themselves as an S-Corp and want to optimize contributions through their W-2 salary and profit distributions
  • High-income self-employed individuals who have maxed out a SEP IRA and want to compare whether a Solo 401(k) would allow larger contributions

🛠️ How to Use This Calculator

  1. Enter Net Business Profit: For sole proprietors, this is your Schedule C net profit minus half of your self-employment tax. For S-Corp owners, this is your W-2 salary paid by the corporation.
  2. Enter your age: The IRS allows a $7,500 catch-up contribution on top of the standard limit for individuals aged 50 and older. The calculator applies this automatically.
  3. Select business type: Sole Proprietors and single-member LLCs calculate the employer contribution as 20% of net adjusted self-employment income. S-Corp owners can contribute 25% of W-2 salary from the corporation.
  4. Review results: The calculator shows your maximum employee deferral, maximum employer profit-sharing contribution, and combined total — the most you can legally shelter from taxes this year.

📐 The Formula

Employee Deferral: Up to $23,500 (2025), or $31,000 if age 50+ (limited to earned income)
Employer Contribution (Sole Prop): 20% of (Net Profit − Half SE Tax)
Employer Contribution (S-Corp): 25% of W-2 Salary from the S-Corp
Total Limit: Lesser of Employee + Employer, or $69,000 ($76,500 if 50+)

💡 Real-World Comparison: Solo 401(k) vs. SEP IRA

Maria is a freelance designer earning $80,000 in net profit. She's 38 years old and wants to maximize her retirement savings.

SEP IRA option: 25% of net compensation (adjusted) ≈ $14,842 maximum contribution.

Solo 401(k) option: $23,500 employee deferral + ~$14,842 employer contribution = approximately $38,342 total.

By using a Solo 401(k) instead of a SEP IRA, Maria shelters an additional $23,500 from federal taxes. At a 22% marginal rate, that's over $5,000 in immediate tax savings — plus the compounding growth advantage of that extra money staying invested.

⚠️ Limitations of This Calculator

  • This calculator assumes you have no other employer-sponsored plan. If you also have a W-2 job with a 401(k), your combined employee deferrals across all plans cannot exceed the annual IRS limit.
  • The Solo 401(k) is only available to businesses with no full-time employees other than the owner and their spouse. If you hire even one part-time employee who works more than 1,000 hours per year, different plan rules may apply.
  • This calculator does not account for state-level taxes or state-specific retirement plan rules.
  • Contribution deadlines matter: employee deferrals must be elected before December 31st for the tax year, while employer contributions can be made up to the tax filing deadline (including extensions).

❓ Frequently Asked Questions

Can I open a Solo 401(k) if I have a day job with a 401(k)?

Yes. If you have self-employment income on the side (from freelancing, consulting, or a side business), you can open a Solo 401(k) for that income. However, the IRS employee deferral limit ($23,500 in 2025) is shared across all plans. If you've already contributed $10,000 to your employer's 401(k), you can only defer $13,500 more into the Solo 401(k). The employer profit-sharing limit is separate and not affected.

What is the deadline to establish a Solo 401(k)?

The plan must be established by December 31st of the tax year for which you want to make contributions. You cannot retroactively open a Solo 401(k) in April and apply it to the prior year's income. However, once the plan is open, employer profit-sharing contributions can be deposited as late as your tax filing deadline, including extensions (typically October 15th).

Should I choose Traditional (pre-tax) or Roth contributions?

Many Solo 401(k) providers now offer a Roth option for the employee deferral portion. If you expect to be in a higher tax bracket in retirement than you are today, Roth contributions make sense — you pay taxes now at a lower rate and withdrawals are tax-free later. If you want a tax deduction today, Traditional contributions reduce your current taxable income immediately.

Why is the Solo 401(k) better for low-income self-employed earners than a SEP IRA?

A SEP IRA only allows employer contributions (approximately 20–25% of net profit), meaning at lower income levels, the maximum is small. A Solo 401(k) allows you to also make the full employee deferral ($23,500), regardless of your profit level — as long as your self-employment income at least covers that deferral. This makes it far superior for early-stage entrepreneurs or part-time freelancers.

Do I need to file special paperwork with the IRS for a Solo 401(k)?

Once your Solo 401(k) assets exceed $250,000, you are required to file IRS Form 5500-EZ annually. Below that threshold, there is no annual filing requirement. Setting up the plan itself typically involves completing a plan adoption agreement with your chosen provider (Fidelity, Vanguard, Schwab, or a self-directed plan provider).

Last updated: September 1, 2026 | All 2026 limits sourced directly from IRS.gov Retirement Topics - 401(k) and Profit-Sharing Plan Contribution Limits.

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