The solo 401k contribution limits for 2026 let a self-employed owner contribute up to $72,000 in total, combining a $24,500 employee salary deferral with an employer profit-sharing contribution of up to 25% of compensation (Source: IRS Notice 2025-67). Age-based catch-up contributions raise that ceiling further. This guide breaks down each piece and shows the self-employed math most articles skip.
For 2026, a solo 401(k) participant can contribute up to $24,500 as an employee elective deferral plus an employer profit-sharing contribution, for a combined limit of $72,000 (excluding catch-up). With the age 50-59 catch-up of $8,000 the total reaches $80,000; the age 60-63 super catch-up of $11,250 reaches $83,250 (Source: IRS Notice 2025-67).
2026 solo 401k contribution limits at a glance
A solo 401(k), also called a one-participant 401(k), Solo-k, Uni-k, or one-participant k, is a traditional 401(k) plan covering a business owner with no employees, or that owner and a spouse (Source: IRS, One-participant 401(k) plans). It has two contribution sources in the same account: the owner acting as employee, and the same owner acting as employer.
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The table below shows each 2026 figure alongside the 2025 figure for reference. Every dollar amount comes from IRS Notice 2025-67, which sets the 2026 cost-of-living adjustments for retirement plans.
| Contribution component | 2026 | 2025 |
|---|---|---|
| Employee elective deferral (section 402(g)) | $24,500 | $23,500 |
| Catch-up, age 50-59 and 64+ (section 414(v)) | $8,000 | $7,500 |
| Super catch-up, age 60-63 (SECURE 2.0) | $11,250 | $11,250 |
| Employer profit-sharing | Up to 25% of compensation | Up to 25% of compensation |
| Combined limit, no catch-up (section 415(c)) | $72,000 | $70,000 |
| Combined with age 50-59 catch-up | $80,000 | $77,500 |
| Combined with age 60-63 super catch-up | $83,250 | $81,250 |
| Annual compensation cap (section 401(a)(17)) | $360,000 | $350,000 |
The $72,000 overall figure is the section 415(c)(1)(A) defined contribution annual additions limit, which Notice 2025-67 increased from $70,000 to $72,000 for 2026. Catch-up contributions sit on top of that overall limit rather than inside it, which is why the age 50-plus totals exceed $72,000. The summed catch-up totals ($80,000 and $83,250) are arithmetic combinations of the separately verified figures.
How the employee deferral limit works
The employee elective deferral is the amount the owner chooses to set aside from earnings, up to $24,500 for 2026 (Source: IRS Notice 2025-67, section 402(g)(1)). The IRS describes this side as elective deferrals up to 100% of compensation, meaning earned income for a self-employed person, capped at the annual deferral limit (Source: IRS, One-participant 401(k) plans).
This deferral limit is per person, not per plan. If someone participates in more than one 401(k) in the same year, the $24,500 ceiling applies across all of them combined, not to each separately. That distinction matters most for people who also have a day job with an employer 401(k), covered in its own section below.
A participant cannot defer more than they earn. For a self-employed owner, the earned income used for this test is net earnings from self-employment after the relevant deductions, so a business with modest net earnings may hit an earnings limit before reaching the dollar cap.
Catch-up contributions by age
Catch-up contributions add to the deferral for older participants. For 2026, the age 50-59 catch-up is $8,000, up from $7,500 in 2025 (Source: IRS Notice 2025-67, section 414(v)(2)(B)(i)). A participant who is 50 or older can therefore defer up to $32,500 as the employee ($24,500 plus $8,000) before employer contributions.
A larger super catch-up applies at ages 60, 61, 62, and 63 under SECURE 2.0. For 2026 it remains $11,250 (Source: IRS Notice 2025-67, section 414(v)(2)(E)(i)). This super catch-up replaces the $8,000 age-50 catch-up for those four ages rather than stacking on top of it. At age 64 and beyond, the catch-up reverts to the standard $8,000 figure.
How the employer profit-sharing contribution is calculated
The employer side lets the business contribute up to 25% of compensation on the owner’s behalf (Source: IRS, One-participant 401(k) plans). What counts as compensation, and therefore how the 25% is applied, differs sharply between an S-corporation owner paid W-2 wages and a sole proprietor or single-member LLC taxed on net self-employment income. This is the point most guides hand-wave, so the worked math follows below.
S-corporation owner: a straight 25% of W-2 wages
For an owner who takes W-2 wages from an S-corporation, the employer contribution is a straight 25% of those wages. If the owner is paid $100,000 in W-2 wages, the employer profit-sharing contribution can be up to $25,000 (25% of $100,000). Add the $24,500 employee deferral and the combined 2026 contribution reaches $49,500, still under the $72,000 overall limit (Source: IRS Notice 2025-67 for the dollar limits; 25% rate per IRS One-participant 401(k) plans).
Sole proprietor or single-member LLC: the effective 20% rate
For a sole proprietor or single-member LLC, the 25% plan rate converts to an effective self-employed rate of 20%. IRS Publication 560 states plainly that a plan rate of 25% (0.25) corresponds to a self-employed rate of 0.2, or 20% (Source: IRS Publication 560, 2025). The reduction happens because the contribution is itself deductible, so the 25% is applied to compensation after that contribution is removed: 0.25 divided by 1.25 equals 0.20.
The base the 20% applies to is net earnings from self-employment, which Publication 560 defines as net earnings reduced by (a) the deduction for one-half of self-employment tax and (b) the deduction for contributions made on the owner’s own behalf (Source: IRS Publication 560, 2025). The step-by-step order is:
- Start with net profit from the business (Schedule C).
- Subtract the deduction for one-half of self-employment tax to arrive at net earnings from self-employment.
- Apply the effective 20% rate to that net-earnings figure to find the maximum employer profit-sharing contribution.
- Add the employee deferral (up to $24,500 for 2026, or more with catch-up) subject to the overall limit.
As an illustration, suppose net earnings from self-employment (after the half-SE-tax deduction) work out to $100,000. The employer profit-sharing contribution can be up to $20,000 (20% of $100,000). Adding the $24,500 employee deferral gives a combined 2026 contribution of $44,500. The precise half-SE-tax figure depends on the year’s Social Security wage base and each owner’s numbers, so Publication 560 supplies a Rate Worksheet, Rate Table, and Deduction Worksheet for the Self-Employed to run the exact calculation (Source: IRS Publication 560, 2025).
The compensation counted for the 25% employer contribution is capped at $360,000 for 2026 (Source: IRS Notice 2025-67, section 401(a)(17)). Compensation above that cap does not increase the allowable employer contribution.
Combining a solo 401(k) with a day-job 401(k)
Someone can hold a solo 401(k) for a side business and also participate in an employer 401(k) at a full-time job. The rules allow both, but only the employee deferral is shared between them. The $24,500 deferral limit for 2026 is a single per-person ceiling across every 401(k) (Source: IRS Notice 2025-67, section 402(g)(1)).
What is not shared is the employer contribution. The 25%-of-compensation profit-sharing contribution in the solo plan is a separate limit tied to the self-employment business, and it remains fully available even if the day-job deferrals have already used up the $24,500. For example, if a day-job 401(k) absorbs the entire $24,500 employee deferral, the solo 401(k) can still receive the employer profit-sharing contribution, up to the $72,000 overall limit for that plan (Source: IRS Notice 2025-67). This is the piece most articles mention but rarely quantify.
Coordinating multiple accounts often interacts with wider tax planning, including how contributions affect adjusted gross income and future required distributions. Q3 Advisors covers related figures in its 2026 retirement contribution limits and required minimum distributions resources.
Roth solo 401(k) and the 2026 catch-up mandate
Many solo 401(k) plans allow a Roth source, letting the owner make employee deferrals with after-tax dollars for tax-free qualified withdrawals later. Roth treatment applies to employee deferrals; SECURE 2.0 also permits Roth employer contributions where a plan offers them, though availability depends on the provider’s plan document. Whether a Roth source exists depends entirely on the specific plan.
Starting in 2026, catch-up contributions must be made as Roth for participants whose prior-year FICA wages exceeded $150,000 (Source: IRS Notice 2025-67, section 414(v)(7)(A), threshold increased from $145,000 to $150,000). This affects solo 401(k) owners who take W-2 wages, such as S-corporation owners above that wage threshold.
Two nuances often go unexplained. First, the mandate keys off FICA wages, so a sole proprietor with no W-2 wages generally has no FICA wages of the type the rule references and may fall outside it; that determination depends on individual circumstances. Second, if a plan does not offer a Roth source, an affected high earner may be unable to make the catch-up at all until the plan adds one, so plan-document features can matter. For owners weighing after-tax strategies, Q3 Advisors describes its approach on its Roth conversion service page.
Deadlines and plan-adoption rules
Contribution timing for a solo 401(k) follows the business tax-filing deadline. Employer profit-sharing contributions can generally be made up to the business tax-filing deadline, including extensions. Employee deferral elections have their own timing rules that often require the election to be in place earlier, so the two sources do not always share the same practical cutoff.
Plan adoption has a separate nuance. Historically a solo 401(k) had to be established by December 31 of the plan year. Under SECURE 2.0 Section 317, a sole proprietor may in some cases adopt a plan after year-end and treat it as effective for the prior year up to the filing deadline, which can affect first-year contributions. Timing rules can be intricate and depend on entity type and elections, so confirming dates for a specific situation is often advisable.
Spouse participation and Form 5500-EZ
A spouse who earns income from the same business can also participate in the solo 401(k), because the plan is defined to cover a business owner or that person and a spouse (Source: IRS, One-participant 401(k) plans). Each spouse has their own employee deferral limit ($24,500 for 2026) and can receive an employer contribution, which can roughly double the household contribution capacity within the plan (Source: IRS Notice 2025-67 for the per-person figures).
Once total plan assets exceed $250,000, the plan generally must file Form 5500-EZ annually with the IRS. Below that threshold, a one-participant plan is typically exempt from the filing. A final Form 5500-EZ is also generally required when the plan terminates, regardless of the asset level.
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Q3 Advisors is a registered investment adviser focused on retirement tax planning. This article is educational and is not advice; for guidance on your own circumstances, consult a qualified tax or financial professional.
Frequently asked questions
How much can I contribute to a solo 401(k) in 2026?
For 2026, the combined limit is $72,000, made up of a $24,500 employee deferral plus an employer profit-sharing contribution of up to 25% of compensation (Source: IRS Notice 2025-67). Catch-up contributions raise the ceiling to $80,000 at ages 50-59 and 64-plus, and to $83,250 at ages 60-63. Actual amounts depend on the owner’s compensation.
Can you have a solo 401(k) and a full-time job with a 401(k)?
Yes. The rules allow both, but the $24,500 employee deferral limit for 2026 is shared across all 401(k) plans per person (Source: IRS Notice 2025-67). The solo 401(k) employer profit-sharing contribution is separate and remains available even if a day-job 401(k) uses the full deferral, up to the $72,000 overall limit for the solo plan.
What is the deadline to open a solo 401(k)?
A solo 401(k) traditionally had to be established by December 31 of the plan year. Under SECURE 2.0 Section 317, a sole proprietor may in some cases adopt a plan after year-end, effective for the prior year up to the tax-filing deadline. Employer contributions can generally be made up to the filing deadline, including extensions. Timing depends on entity type.
How is the employer contribution to a solo 401(k) calculated?
The employer contribution is up to 25% of compensation (Source: IRS, One-participant 401(k) plans). For an S-corporation owner, that is 25% of W-2 wages. For a sole proprietor, the 25% plan rate equals an effective 20% of net earnings from self-employment after the half-SE-tax deduction, because 0.25 divided by 1.25 equals 0.20 (Source: IRS Publication 560, 2025).
Can I contribute to both a solo 401(k) and a SEP IRA?
The two can technically coexist, but if both cover the same self-employment business, the combined employer-type contributions are generally limited by the same overall section 415(c) ceiling ($72,000 for 2026) and the compensation-based percentage rules (Source: IRS Notice 2025-67; IRS Publication 560, 2025). Running both for one business rarely adds capacity. The right structure depends on individual facts.
What happens if I contribute too much to a solo 401(k)?
Excess contributions can trigger taxes and penalties and generally need to be corrected. Excess employee deferrals above the $24,500 limit (2026) are typically corrected by removing the excess and related earnings by the applicable deadline; excess employer contributions have their own correction rules (Source: IRS Notice 2025-67 for the limit). Because corrections are technical, professional guidance is often advisable.
Can my spouse contribute to my solo 401(k)?
Yes, if the spouse earns income from the same business, because the plan may cover the owner and a spouse (Source: IRS, One-participant 401(k) plans). Each spouse has a separate $24,500 employee deferral limit for 2026 and can receive an employer contribution, which can roughly double the household contribution within the plan (Source: IRS Notice 2025-67).
Is a solo 401(k) contribution tax deductible?
Traditional (pre-tax) solo 401(k) contributions are generally deductible, with the deduction limited to the lesser of actual contributions or 25% of compensation paid to participants (Source: IRS Publication 560, 2025). Roth contributions are made after tax and are not deductible. Deductibility of any specific amount depends on the owner’s entity type, compensation, and overall tax situation.
Sources
IRS Notice 2025-67, 2026 Amounts Relating to Retirement Plans and IRAs (Internal Revenue Bulletin 2025-49): https://www.irs.gov/pub/irs-drop/n-25-67.pdf
IRS newsroom, 401(k) limit increases to $24,500 for 2026: https://www.irs.gov/newsroom/401k-limit-increases-to-24500-for-2026-ira-limit-increases-to-7500
IRS, One-participant 401(k) plans: https://www.irs.gov/retirement-plans/one-participant-401k-plans
IRS Publication 560, Retirement Plans for Small Business (2025): https://www.irs.gov/publications/p560
IRS, COLA increases for dollar limitations on benefits and contributions: https://www.irs.gov/retirement-plans/cola-increases-for-dollar-limitations-on-benefits-and-contributions
