Solo 401(k) Calculator

2026

Calculate employee + employer Solo 401(k) contributions. Compare to SEP IRA limits.
$
Employee Contribution Type

Employee Contribution

$24,500.00

Employer Contribution

$27,880.57

Total Contribution

$52,380.57

Contribution Breakdown

Employee Deferral (traditional)$24,500.00
Employer Profit Sharing (20%)$27,880.57
2026 Total Cap$72,000.00
Your Total Contribution$52,380.57
Effective Savings Rate34.92%

Solo 401(k) vs SEP-IRA

Solo 401(k) Total$52,380.57
SEP-IRA Max$27,880.57
Solo 401(k) Advantage$24,500.00
Estimated Tax Savings$12,571.34

Use the Solo 401(k) Calculator above to calculate your results. Enter your values and see instant results — all calculations run in your browser.

Disclaimer: This calculator is for informational purposes only and does not constitute tax, financial, or legal advice. Results are estimates based on the information you provide and current rates. Always consult a qualified tax professional or financial advisor for advice specific to your situation.

How It Works

A Solo 401(k) Calculator determines the maximum retirement contribution limits for self-employed individuals and business owners with no employees. For 2026, participants can contribute up to $70,000 annually ($77,500 if age 50 or older), making this one of the most powerful retirement savings vehicles available. Understanding your contribution capacity helps maximize tax advantages and accelerate retirement savings.

The calculation combines employee deferrals (limited to 100% of compensation up to $24,000 in 2026) plus employer contributions (up to 25% of net self-employment income for sole proprietors, or 100% of compensation for incorporated businesses). Net self-employment income is calculated as business profit minus half of self-employment tax, which affects the final contribution limit.

Many business owners mistakenly calculate employer contributions based on gross profit rather than net self-employment income, leading to over-contributions and potential penalties. Remember that total contributions cannot exceed 100% of your compensation, and if you have multiple retirement plans, aggregate contribution limits may apply. Consider making contributions by the tax filing deadline, including extensions, to maximize your planning flexibility.

Freelance Consultant with $85,000 Net Self-Employment Income

  1. 1 Sarah, a 45-year-old freelance marketing consultant, reports $85,000 in net business profit for 2026 and pays $12,009 in self-employment tax.
  2. 2 Calculate net self-employment income: $85,000 - ($12,009 ÷ 2) = $85,000 - $6,005 = $78,995 in compensation for Solo 401(k) purposes.
  3. 3 Employee deferral limit: $24,000 (2026 limit). Employer contribution: $78,995 × 20% = $15,799. Combined potential contribution: $24,000 + $15,799 = $39,799.
  4. 4 Sarah can contribute a maximum of $39,799 to her Solo 401(k) in 2026, providing substantial tax savings while staying well under the $70,000 annual limit. This contribution reduces her taxable income and accelerates her retirement savings significantly.

Source: IRS · Last updated: April 2026

Frequently Asked Questions

How much can I contribute to a Solo 401(k) in 2026?
The 2026 Solo 401(k) limit is $24,500 as an employee elective deferral ($32,000 if 50+), plus up to 25% of net self-employment income as an employer contribution. The combined total cannot exceed $72,000 ($79,500 if 50+).
Is a Solo 401(k) better than a SEP IRA?
Often yes. The Solo 401(k) allows higher contributions at lower income levels because of the employee deferral portion. It also allows Roth contributions, loans, and is not subject to the SEP IRA pro-rata issue for backdoor Roth conversions. The only downside is slightly more paperwork.
Can I open a Solo 401(k) if I have employees?
No. A Solo 401(k) is exclusively for business owners with no full-time employees other than a spouse. If you hire employees (other than your spouse), you must use a different plan type like a SEP IRA, SIMPLE IRA, or traditional 401(k).

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