Solo 401(k) Contribution Limits (2026)

If you’re self-employed or run a small business with no employees other than yourself (and at most, a spouse), then the Solo 401(k) can be one of the most powerful retirement-savings tools available. These plans offer much higher contribution limits than traditional IRAs and allow both employee and employer contributions. The good news is that the IRS just bumped up those limits again for 2026. Let’s go through what you can contribute, how the limits compare to 2025, and how you could take full advantage.

What’s a Solo 401(k)?

A Solo 401(k), also called an individual 401(k) or self-employed 401(k), is built for business owners with no full-time employees besides themselves and their spouse. It combines:

• Employee contributions (like a regular 401(k), and
• Employer profit-sharing contributions (like a SEP IRA) to give you a high total retirement savings ceiling

2026 Solo 401(k) Contribution Limits

Employee Elective Deferrals (Your Salary)

• Under age 50: You can contribute up to $24,500 as an employee
• Ages 50-59 or age 64+ catch-up: You can contribute an extra $8,000, bringing your total employee contribution limit to $32,500
• Ages 60-63 super catch-up: If your plan allows, you can contribute up to $11,250, making your total $35,700

These limits apply whether you make pre-tax or Roth contributions.

Employer Profit-Sharing Contributions

As the employer, you can also contribute up to 25% of your net self-employment income (after Social Security and Medicare taxes) toward your Solo 401(k).

Total Contribution Limit for 2026

For most people under age 50, total Solo 401(k) contributions (employee + employer) can reach $72,000. But if you’re eligible for catch-up contributions (50+), the total could be even higher because the catch-ups are in addition to that $72,000 cap.

This makes Solor 401(k)s extremely powerful for aggressive savers, especially compared with other retirement plans like traditional IRAs.

Not sure if you’ll contribute every year or want a retirement account with the easiest setup and low maintenance? Then the SEP IRA might be for you.

How 2026 Compares to 2025

Here’s how the limits stack up year-over-year:

2025 Solo 401(k) Limits

• Employee deferrals: up to $23,500
• Catch-ups: $7,500 (ages 50-59 or 64+), $11,250 (ages 60-63, if plan allows)
• Total employee + employer limit: $70,000
• With catch-ups, high earners could reach up to roughly $77,500 to $81,250, depending on age and plan specifics

2026 Changes

• Employee limit rises from $23,500 to $24,500
• Standard catch-up increases from $7,500 to $8,000
• Total contribution ceiling increases from $70,000 to $72,000

The extra space gives more tax-advantaged room to grow your retirement savings, especially if you’re self-employed with variable income.

How it Works in Practice

Let’s say Samantha, age 45, runs her own business and has a net self-employment income large enough to take full advantage of Solo 401(k) limits. In 2026, she could contribute:

• Up to $24,500 as her employee salary-deferral
• Up to 25% of her compensation as employer profit-sharing
  → Totaling up to $72,000 for the year

If Samantha were 55, she could stack on an $8,000 catch-up contribution, potentially bringing her Solo 401(k) savings over the $80,000 mark for the year.

Why These Limits Matter

Solo 401(k)s let you save way more than traditional retirement accounts like IRAs:

• In 2026, an IRA’s basic contribution limit is $7,500 (plus a $1,100 catch-up for age 50+)
• Compared to Solo 401(k) limits that can surpass $72,000, the gap is huge for high-income and self-employed savers.

This makes Solo 401(k)s great for:

• High earners who want to shelter income from taxes
• Business owners with uneven cash flow who can flex contributions year to year
• Anyone who wants to turbocharge retirement growth while minimizing current-year taxes

Roth and Pre-Tax Options

Typically, Solo 401(k) limits don’t change whether you contribute pre-tax or Roth. That means the $24,500 employee limit can be split between both types or designated entirely to either method. Basically, whichever fits your tax strategy best.

Many self-employed savers prefer Roth contributions if they expect to be in a higher tax bracket in retirement, while others use traditional pre-tax contributions to reduce taxable income today.

Things to Keep in Mind

Net self-employment income matters: Employer contributions are based on net profit after payroll taxes, so your actual potential could vary year to year.

Plan rules vary: Not every provider supports every catch-up portion (especially the super catch-up for ages 60-63), so double-check your plan details when needed.

The Money Move

Solo 401(k)s are one of the most flexible and high-limit retirement plans for self-employed workers. In 2026, the IRS increased both the basic contribution limit and the total contribution ceiling, giving savers more choice and more room to save before taxes.

Whether you’re just starting your own business or are a veteran, understanding these limits and how they compare to 2025 can help you decide how to allocate your retirement dollars. 

Maximizing Solo (401)k contributions now could mean a much more comfortable retirement later. AKA put in the work now, (let the money compound over the years) so you can play sooner!

FAQs

1. Can I contribute to a Solo 401(k) if I also have a W-2 job?

Yes! You can still open and fund a Solo 401(k) for your self-employed income, but just note that the employee contribution limit applies across ALL 401(k) plans combined. The employer contribution is based only on your self-employed income.

2. Do Solo 401(k) contribution limits apply per person or per business?

They apply per person, not per business. So even if you have multiple side hustles, the employee deferral limit is shared across all 401(k)s you contribute to.

3. Can I make both Roth and traditional contributions?

Yes! Most Solo 401(k) plans let you split your employee contributions between Roth and traditional, as long as the total stays within the annual limit.

4. Are catch-up contributions included in the $72,000 limit for 2026?

No. Catch-up contributions (for those age 50+) are on top of the $72,000 employee + employer limit, letting older workers save to contribute even more.

5. Do I need to open a Solo 401(K) before December 31 to contribute?

Yes. Your Solo 401(k) must be established by December 31 of the tax year to make employee contributions, though employer contributions can often be made up until the tax filing deadline.

6. How is employer contribution calculated if I’m self-employed?

Employer contributions are based on net self-employment income after payroll taxes, not gross revenue. This often surprises first-time Solo 401(k) users.

7. Is a Solo 401(k) better than a SEP IRA?

For many people. yes. A Solo 401(k) lets employee contributions at lower income levels, offers Roth options, and supports catch-up contributions, which SEP IRAs do not.

Read more:

Self-Employed? Here’s How a Solo 401(k) Works
Solo 401(k) vs SEP IRA: What’s the Difference?