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Freelance Finance

Freelance Retirement Calculator

Estimate your 2026 Solo 401(k) and SEP IRA contribution limits using IRS self-employed plan rules.

Net self-employment profit ($) Schedule C or partnership net profit before retirement contributions.
Age at year-end Used for catch-up contribution limits.
W-2 Social Security wages ($) Optional. Reduces remaining Social Security wage base for SE tax.
Other 401(k) deferrals ($) Deferrals already made to another employer plan this year.
Roth share of employee deferral (%) Roth employee deferrals count toward limits but are not deductible.
Marginal tax rate for deduction estimate (%) Used only to estimate possible federal tax savings from deductible contributions.

Self-employed compensation calculation

Net earnings for SE tax
$110,820.00
Self-employment tax
$16,955.46
Deductible half of SE tax
$8,477.73
Plan compensation used
$111,522.27

Maximum Solo 401(k)

$46,804.45

$24,500.00 more than the SEP IRA estimate.

Solo 401(k) breakdown

Employee deferral
$24,500.00
Catch-up contribution
$0.00
Employer profit sharing
$22,304.45
Potential deduction
$46,804.45
Tax savings estimate
$11,233.07

SEP IRA comparison

SEP contribution
$22,304.45
SEP deduction estimate
$22,304.45
Tax savings estimate
$5,353.07

2026 limits used

Deferral limit
$24,500
Catch-up limit
$0
Annual additions limit
$72,000

How Solo 401(k) limits work for freelancers

A one-participant 401(k), often called a Solo 401(k), lets a self-employed business owner contribute as both employee and employer. This calculator first estimates net earnings from self-employment, subtracts the deductible half of self-employment tax, applies the IRS compensation cap, then calculates the employee deferral, catch-up contribution, and employer profit-sharing contribution.

Formulas

net_earnings_for_se_tax = net_profit * 92.35%
self_employment_tax     = social_security_tax + medicare_tax
adjusted_net_earnings   = net_profit - 50% of self_employment_tax
plan_compensation       = min(adjusted_net_earnings, IRS compensation limit)

employee_deferral       = min(remaining 402(g) limit, plan_compensation)
catch_up                = age-based catch-up limit, if eligible
employer_contribution   = min(20% of plan_compensation, annual additions room, 50% of compensation left after regular deferrals)
solo_401k_total         = employee_deferral + catch_up + employer_contribution
sep_ira_total           = min(20% of plan_compensation, annual additions limit)

Official source assumptions checked

This calculator uses IRS 2026 limits: a $24,500 elective deferral limit, $8,000 standard age-50 catch-up, $11,250 catch-up for ages 60-63, $72,000 annual additions limit excluding catch-up contributions, and a $360,000 compensation limit. The self-employment tax adjustment uses the 2026 Social Security wage base of $184,500.

What this tool does not include

It does not establish a plan, check plan document terms, model spouse contributions, calculate Form 5500-EZ filing requirements, handle common-law employees, apply controlled-group rules, determine Roth eligibility for catch-up rules, or replace Publication 560 worksheets. Use it as a planning estimate before confirming final contributions with your CPA, TPA, or plan provider.

References

FAQ

Why does the employer contribution use 20% instead of 25%?

For self-employed people, the contribution calculation is circular. A 25% plan contribution rate generally converts to 20% of adjusted net earnings.

Do Roth Solo 401(k) deferrals reduce my tax deduction?

Yes. Roth employee deferrals count toward the contribution limit but are not deductible today. Employer profit-sharing contributions are generally pre-tax.

Why enter W-2 Social Security wages?

W-2 wages can use up part of the Social Security wage base, changing self-employment tax and therefore the adjusted earnings used for plan contributions.