Retirement

Solo 401(k) Contribution Calculator

A Solo 401(k) lets you contribute as both employee and employer, often sheltering far more than a regular IRA. Estimate your potential contribution from your net self-employment income.

Net self-employment profit (year)

Add age 50+ catch-up?

Marginal tax rate (for savings estimate)

Estimated max contribution

Employee deferral
Employer profit-share (~20%)
Estimated tax saving

Based on 2026 limits: a $24,500 employee deferral ($32,500 with the 50+ catch-up) plus roughly 20% of net earnings as the employer share, capped at the overall $72,000 limit ($80,000 with catch-up). A simplified estimate for owner-only businesses.

This calculator gives a simplified estimate for educational purposes and uses approximate figures. It is not tax or financial advice and does not account for every rule, credit, or your full situation. Confirm specifics with a qualified professional. See our full disclaimer.

How the Solo 401(k) Calculator works

A Solo 401(k) — also called an individual 401(k) — is a retirement account for owner-only businesses with no employees other than a spouse. Its superpower is that you contribute in two capacities at once, which often lets you shelter far more than a regular IRA. This calculator estimates your maximum contribution from your net self-employment income.

It works in two parts. As the employee, you can defer up to the annual elective limit. As the employer, you can add roughly 20% of your net earnings — calculated after subtracting half of your self-employment tax — as a profit-sharing contribution. The calculator adds these together and caps the total at the overall annual limit, with an optional catch-up amount if you are 50 or older.

Why it beats a regular IRA for many freelancers

A standard IRA has a relatively low contribution limit. Because the Solo 401(k) combines an employee deferral with an employer profit-share, a self-employed person at a modest income can often contribute several times more. At lower and middle incomes the flat employee deferral is what does the heavy lifting, which is also why a Solo 401(k) frequently lets you save more than a SEP IRA at the same income.

A tax break that works twice

Traditional Solo 401(k) contributions do double duty. They build long-term wealth, and they reduce your taxable income for the year — which for a freelancer in a meaningful bracket is a large, immediate saving. The calculator includes an estimated tax-saving figure based on your marginal rate so you can see both effects at once. Many plans also offer a Roth option and, in some cases, loans, features a SEP IRA lacks.

Setup and deadlines matter

The timing of opening and funding the account affects whether a contribution counts for the current tax year, so it pays to decide before year-end rather than at filing time. Contribution limits also change annually, so treat the result as a planning estimate and confirm current figures and your eligibility with a professional before contributing.

Frequently asked questions

What is a Solo 401(k)?

It is a 401(k) for owner-only businesses with no employees other than a spouse. Its advantage is that you contribute in two capacities — as the employee (an elective deferral) and as the employer (a profit-sharing contribution) — which often shelters far more than a regular IRA.

How is the contribution calculated?

You can defer up to the annual employee limit, plus add roughly 20% of your net self-employment earnings (after half of SE tax) as the employer portion, capped at the overall annual limit. The calculator estimates each part for you.

Solo 401(k) or SEP IRA — which is better?

At lower and middle incomes the Solo 401(k) usually wins because the flat employee deferral lets you contribute more. A SEP IRA is simpler to administer. Many self-employed people choose the Solo 401(k) for its higher limits and Roth option.

How does it save me money now?

Traditional contributions reduce your taxable income for the year, so a contribution can lower your income tax immediately while it also builds your retirement — money working in two directions at once.