Solo 401(k) Contribution Calculator
Wearing both hats pays off here: contribute as the employee and as the employer. See your ceiling for the year and how it compares with a SEP IRA.
- Employee $24,500
- Employer 20% $14,870
- Catch-up $0
| Employee deferralLimit $24,500 | $24,500 |
| Employer contribution20% of $74,348 | $14,870 |
| Catch-up | $0 |
| Total | $39,370 |
| SEP IRA maximum, for comparison | $14,870 |
Solo 401(k) vs SEP IRA at a glance
Both plans give you the same 20% employer contribution. The solo 401(k) adds the employee deferral on top, which is why it wins at almost every income below the annual cap. The trade-offs: a solo 401(k) is only for businesses with no employees other than a spouse, and once plan assets pass $250,000 you file Form 5500-EZ each year. Roth deferrals are allowed in most solo 401(k) plans; they don't cut this year's tax but grow tax-free. Source: IRS "One-Participant 401(k) Plans" and Publication 560.
Questions freelancers ask
What is the solo 401(k) contribution limit for 2026?
Up to $72,000 in total: an employee deferral of up to $24,500 plus an employer profit-sharing contribution of 20% of net self-employment earnings. Catch-up contributions come on top: $8,000 at age 50+, or $11,250 at ages 60–63.
How is the solo 401(k) employer contribution calculated for a sole proprietor?
Net profit minus half of self-employment tax, times 20%. The deferral and the employer share together cannot exceed that same net earnings figure or the annual limit.
Does a 401(k) at my day job reduce my solo 401(k) limit?
The $24,500 employee deferral limit is per person across all plans, so deferrals at a day job reduce what you can defer to the solo 401(k). The 20% employer contribution is separate and unaffected.
When must solo 401(k) contributions be made?
The employer contribution can be made up to your tax filing deadline, including extensions. For an existing plan, employee deferrals generally need to be elected by December 31; since SECURE 2.0, a sole proprietor opening a brand-new plan can make first-year deferrals up to the filing deadline. Check the rules of your plan provider.