Solo 401(k) or SEP IRA?
Self-employment income buys more retirement room than most people use. This free calculator shows your real 2026 maximum under each plan, Keogh math included.
Schedule C net profit (or your share of partnership SE income) expected for 2026, before any retirement contribution.
Box 3 of your W-2(s), if you're also employed. Those wages use up the $184,500 Social Security wage base first, which lowers your SE tax. Leave blank if fully self-employed.
The $24,500 employee deferral limit is per person, not per plan. Whatever you defer at an employer's 401(k) is unavailable in your solo 401(k).
Both plans share the same employer side, about $18,587 here (20% of your net self-employment earnings of $92,935). The solo 401(k) wins by $24,500 because it adds the employee deferral on top, room a SEP IRA simply does not have at this income.
Estimate for tax year 2026 using the $24,500 employee deferral limit, the $8,000 age-50 catch-up, the $72,000 §415(c) annual additions limit, and the $184,500 Social Security wage base. Net self-employment earnings are profit minus half of self-employment tax; the employer side is 25% of compensation, which is 20% of net SE earnings for the self-employed. Assumes an unincorporated business (sole proprietor or partner). S corp owners contribute from W-2 salary instead, and the math changes. A Keogh profit-sharing plan follows the same limits as the solo 401(k) employer side. A planning estimate, not tax advice. Runs entirely in your browser; nothing is stored or sent.
One base, two stacks.
The two plans are not competitors so much as the same employer contribution with different toppings. The calculator runs the IRS worksheet math, including the day-job coordination that trips up moonlighters and the Overemployed.
Net SE earnings
Start with Schedule C profit, subtract half of self-employment tax. That is the compensation base both plans build on, and W-2 wages at a day job change the SE tax first.
The employer side
Both a SEP IRA and the profit-sharing side of a solo 401(k) allow 25% of compensation, 20% of net SE earnings, capped at $72,000. This is all a SEP IRA gets.
The deferral on top
The solo 401(k) adds the $24,500 employee deferral, minus whatever you already deferred at a day job, plus the $8,000 catch-up at 50. That stack is its whole advantage.
Before you open one.
What is a Keogh plan, and is this the same calculator?
Keogh is the older name for a qualified retirement plan for the self-employed, and the term survives in textbooks and on brokerage paperwork. A Keogh profit-sharing plan today follows the same math as the employer side of a solo 401(k): 25% of compensation, which works out to 20% of net self-employment earnings, capped at $72,000 for 2026. So yes, this calculator answers the Keogh contribution question with current limits.
Why is the limit 20% of my profit instead of 25%?
The 25% employer rate applies to compensation after the contribution itself and after half of your self-employment tax. Solving that circular definition algebraically lands at 20% of net self-employment earnings (profit minus half of SE tax). It is the same rule from two directions, and the 20% shortcut is how the IRS's own worksheets compute it.
I have a 401(k) at my day job. Can I still use a solo 401(k)?
Yes, and this is where the coordination matters. The $24,500 employee deferral limit is per person across all plans, so deferrals at your employer's 401(k) use it up. But the $72,000 annual additions limit is per unrelated employer, so the employer side of your solo 401(k), 20% of net SE earnings, remains fully available even if you maxed the day-job plan.
Solo 401(k) or SEP IRA: which should I pick?
If your deferral limit is not used up elsewhere, the solo 401(k) almost always allows a larger contribution at the same income, because it stacks the employee deferral on top of the employer side. A SEP IRA is simpler to open and administer, and it wins on convenience when the dollars come out even. One warning for backdoor Roth users: a SEP IRA balance triggers the pro rata rule, while a solo 401(k) does not.
Does this calculator store my information?
No. It runs entirely in your browser. Nothing you type is sent to a server, stored, or shared.
Turn side income into sheltered income.
The plan has to exist before you can fund it, and a solo 401(k) must generally be established by year end. Thirty minutes settles the plan choice and the deadline.