Solo 401(k) Contribution Calculator

A Solo 401(k) (also called Individual 401(k) or one-participant 401(k)) is a 401(k) plan for self-employed individuals or small business owners with no employees other than themselves and their spouse. Available to sole proprietors, single-member LLCs, S-corps, and C-corps. The owner can contribute as both employee (salary deferral) AND employer (profit-sharing) - substantially higher limits than SEP-IRAs at the same income level.

Total annual additions limit: $72,000 (or higher with catch-up). Employee deferral: $24,500 + $8,000 catch-up at 50+ + $11,250 "super catch" at 60-63 (SECURE 2.0). Employer contribution: 25% of W-2 salary (S-corp) or ~20% effective of net self-employment income (sole prop / SMLLC) due to the deduction interaction. Combined cap: $72,000 + applicable catch-ups. Roth Solo 401(k) variant available since SECURE 2.0.

Solo 401(k) almost always wins for the same income level because: (1) employee deferrals stack on top of employer contributions; (2) age 50+ catch-up of $8,000 available (SEP has none); (3) Roth option; (4) loan provisions up to $50,000 or 50% of balance; (5) easier to roll pre-tax IRAs in (helps backdoor Roth). SEP wins on simplicity - no Form 5500-EZ filing until $250K plan assets, no plan document required, can be opened up until tax-filing deadline.

For a new plan first year, SECURE 2.0 lets a sole proprietor establish the plan by the tax-filing deadline including extensions and make both employer and employee contributions for that year; in later years, employee deferral elections must be made by year-end. Contributions can be made up until the tax-filing deadline (April 15 or October 15 with extension). Form 5500-EZ filing is required once plan assets exceed $250,000.

That factor removes half of the self-employment tax (15.3% total), since the self-employed can deduct that half. The result is the earnings base on which the employer contribution is calculated.

Yes. Roth Solo 401(k) contributions have no income limit and are available at all major custodians. They grow tax-free, and qualified withdrawals are also tax-free.

The Solo 401(k) is designed for businesses with no W-2 employees (except a spouse). If you hire an employee who works 1,000 hours or more per year, the plan is disqualified and you must convert it to a standard 401(k) plan.