Solo 401k Contributions for 2026
Starting a Solo 401(k) plan in 2026 has even more benefits than it did in years prior. The Solo 401(k) plan is designed specifically for self-employed individuals or small business owners with no full-time employees other than the owner(s) and their spouse(s). There are many features of the plan that make it so appealing and popular among self-employed business owners. However, the ability to make high annual maximum contributions is probably the most popular Solo 401(k) plan feature.
Solo 401k plans are designed for entrepreneurs, contract workers and the self-employed who have no employees other than a spouse, and there can be big benefits to using this type of plan. Participants can self-direct their money and investments, there are generous contribution limits, and there are minimal tax filing requirements. It offers all of the benefits of a traditional plan as well as some additional benefits. The generous contribution opportunities are what will be discussed herein.
Maximum Solo 401(k) Plan Contribution
In general, a Solo 401(k) plan consists of two components: (i) employee deferrals and (ii) employer profit sharing contributions. First, there is the elective deferral which is the contribution you make as the employee. The second type of contribution for a Solo 401(k) is the employer contribution, which is a percentage of your self-employment income or your schedule C if you’re a single member LLC or sole proprietor.
For 2026, the maximum aggregate Solo 401(k) contribution, including employee deferrals and employer profit-sharing contributions, is $72,000 for individuals under age 50, and $80,000 for those age 50 or older. For participants between ages 60 and 63, the maximum contribution can be as high as $83,250.
Two Types of Solo 401k Contributions
As the employee, you can contribute $24,500 if you are under age 50, or $32,500 if you are 50 or older in 2026. This contribution can be made on a pre-tax basis, up to 100% of your earned income.
Additionally, you can contribute up to 20% of your net self-employment income as the employer, which is also made with pre-tax dollars. Your contributions as both employer and employee can quickly add up.
Your Solo 401k limits apply per person, rather than by plan. So, it’s important to know your individual contributions. Some Solo 401k providers also offer a Roth 401k option, but this requires investment on an after-tax basis. Those would be tax-free in retirement.
Who Can Get Started?
If you generate some form of self-employment income, you can (and should) establish a Solo 401k plan. Even if that self-employment income is a side gig in conjunction with a regular 9-to-5, you qualify. Establishing a Solo 401k is a great way to maximize your retirement savings if you were late in getting started. It will also benefit investors who are uncomfortable making traditional investments.
Related: Solo 401(k) Investment Options
How to Get Started:
To establish a Solo 401k, set up an application with your Self-Directed 401k provider. You must have an Employee Identification Number (EIN). As you contribute more and more to your plan, you may need to fill out additional paperwork. Be aware of any fees a plan custodian may charge so you know what your true cost is, and then begin building your retirement savings for yourself.
About the Author
Adam Bergman is a tax attorney and the founder of IRA Financial, one of the largest Self-Directed IRA platforms in the United States. He has helped more than 27,000 clients take control of their retirement savings, overseeing over $5 billion in retirement assets. Adam is also the author of nine books focused on helping investors understand and confidently manage their retirement strategies.
