Solo 401(k) Calculator (Self-Employed Individual 401k)
Enter your annual net profit (or W-2 compensation) and age to estimate the maximum contribution to a US Solo 401(k), an individual 401(k) for self-employed business owners with no employees, split into employee deferral and employer contribution.
What is a Solo 401(k)?
A Solo 401(k) (also called an Individual 401(k)) is a US 401(k) plan designed specifically for self-employed business owners with no employees. Unlike a SEP IRA (money.wealth.sep_ira_calculator), which only allows an employer contribution, a Solo 401(k) has a dual structure: you can contribute as an "employee" in addition to contributing as an "employer" based on a percentage of compensation.
This dual structure often lets you reach a higher total contribution than a SEP IRA from the same net profit. This tool supports both self-employed (sole proprietor) and employee/officer (W-2 compensation) cases, estimating the employee deferral, the employer contribution, and the combined maximum contribution.
Sources used in this calculation
Statutory figures such as tax and insurance rates come from the public bodies listed below. They change when the law is revised, so please also check the primary source before relying on the result for an important decision.
- US retirement plan contribution limits (401(k), IRA, SEP and others, tax year 2026) — Internal Revenue Service (IRS) Effective 2026-01 to 2026-12 ／ Last checked 2026-09-19
How to use
- Choose your contributor type Select whether you are contributing as a self-employed sole proprietor or as an employee/officer based on W-2 wages
- Enter your annual net profit if self-employed Enter the annual net profit after business expenses, as reported on Schedule C
- Enter any W-2 wages already earned this year If you also have employment income outside your business, use it to correctly estimate the remaining Social Security wage-base room
- Enter your annual W-2 compensation if an employee/officer Enter the salary your corporation pays you
- Enter your age Used to determine eligibility for catch-up contributions at age 50+ and ages 60-63
Tips for getting more out of it
- A Solo 401(k) requires that you have no employees other than yourself (and a spouse). If you plan to hire employees in the future, consider transitioning to a regular 401(k) plan.
- If you also participate in a 401(k) at another job, the employee deferral limit ($24,500 for 2026) is aggregated across all plans, so be careful not to over-contribute.
- Unlike a SEP IRA, many providers allow you to take a loan against your Solo 401(k) balance.
- This tool only provides a simplified estimate. For the exact contribution amount, we recommend confirming with a tax professional or using the worksheets in the latest IRS Publication 560.
Use cases
Maximize tax-advantaged retirement savings as a sole proprietor
Check whether a Solo 401(k) lets you contribute more than a SEP IRA, informing which retirement account to choose
Estimate contributions after incorporating (e.g. S-corp)
If you pay yourself W-2 wages after incorporating, check the estimated employee deferral and employer contribution
Compare against a SEP IRA or a Traditional/Roth IRA
Combine with money.wealth.sep_ira_calculator and money.wealth.ira_calculator to compare which account allows a larger contribution from the same net profit
Plan for retirement including catch-up contributions
For ages 50+ and 60-63, check the maximum contribution including the extra catch-up contribution room
Glossary
- Solo 401(k)
- Also called an Individual 401(k), this is a 401(k) plan designed for self-employed business owners with no employees. You can contribute in the dual roles of "employee" and "employer".
- Employee deferral (elective deferral)
- The amount you can contribute as an "employee" from wages or net profit. The base limit for 2026 is $24,500, with additional catch-up contributions allowed at age 50+ and ages 60-63.
- Employer contribution (profit sharing)
- The amount you can contribute as an "employer", a percentage of compensation (25% for W-2 compensation, an effective 20% for self-employed net earnings).
- Catch-up contribution
- An additional contribution allowance for age 50+ ($8,000 for 2026) and ages 60-63 (a higher $11,250 for 2026 under SECURE 2.0). It is not counted toward the annual additions limit.
- Annual additions limit
- The combined limit on the employee deferral and employer contribution (excluding catch-up contributions), $72,000 for 2026.
- Self-Employment Tax
- The combined Social Security and Medicare tax paid by self-employed individuals. Regular employees split this with their employer, but the self-employed pay both halves (15.3% combined).
Frequently asked questions
Side Note — A huge tax shelter built for one
The Solo 401(k) is a relatively new option, expanded for the self-employed by the Economic Growth and Tax Relief Reconciliation Act (EGTRRA) of 2001. Its dual structure, where the same person contributes as both "employee" and "employer", is unique: in a regular corporate 401(k), the employee deferral and the employer match come from two separate parties, whereas in a Solo 401(k) one person plays both roles.
This dual structure often lets a Solo 401(k) reach a higher total contribution than a SEP IRA, and the gap is especially noticeable for self-employed individuals with a modest net profit. For example, with $50,000 in net profit, a SEP IRA (employer contribution only, an effective 20%) would cap out around $8,500, while a Solo 401(k) can add the $24,500 employee deferral on top, substantially raising the total possible contribution.
Comparable programs in Japan include the Small Enterprise Mutual Aid (Kokyosai), the National Pension Fund, and iDeCo (individual-type defined contribution pension). All of these support retirement savings for the self-employed and small business owners, but the US approach of splitting the contribution limit into separate "employee" and "employer" roles is a distinctive feature not found in Japan's programs.