{
  "slug": "solo-401k",
  "name": "Solo 401k",
  "aliases": [
    "individual 401k",
    "self employed 401k",
    "one participant 401k",
    "solo 401(k)"
  ],
  "family": "accounts",
  "heat": "mid",
  "talk": "Some talk",
  "mostDiscussed": false,
  "firstLine": "A solo 401(k) is a retirement plan for a business owner without eligible common-law employees, potentially also covering the owner’s spouse. The owner may contribute in employee and employer roles.",
  "whyLine": "The account brings plan administration as well as contribution room: business income, other workplace deferrals, hiring and eventually closing the plan can all change the paperwork.",
  "feelWords": [
    "solo 401k",
    "individual 401k",
    "self employed retirement"
  ],
  "commonPicture": [
    {
      "lead": "Two contribution roles use different rules",
      "why": "The owner’s employee deferral and employer contribution are not the same calculation. [community]"
    },
    {
      "lead": "2026 basic limits: $24,500 and $72,000",
      "why": "The first is the employee deferral ceiling; the second is overall additions, subject to earnings and plan conditions. [community]"
    },
    {
      "lead": "Other plans and employees matter",
      "why": "Employee deferrals are shared across applicable plans; hiring eligible workers can change the arrangement. [community]"
    }
  ],
  "watchFor": "Hiring eligible employees, contribution deadlines and plan administration can change the arrangement. A SEP IRA is a separate plan type with different rules. This is not advice.",
  "whatPeopleSay": [
    "**The job:** retirement account for a one-person shop. [community]",
    "**r/personalfinance self-employed** compares solo 401k vs SEP IRA. [community]",
    "**Mega backdoor** sometimes exists here too if the plan allows — different card. [community]",
    "**Not advice.** [community]"
  ],
  "howPeopleRunIt": [
    "**Confirm they are actually self-employed with profit.** [community]",
    "**Open the plan before the deadline people always miss.** [community]",
    "**Calculate the two contribution roles from the records:** the owner’s employee deferral and business-side employer contribution use different limits and earnings calculations. [community]"
  ],
  "amountsPeopleUse": [
    "**Employee deferral cap** still exists. [community]",
    "**Employer contribution:** the available amount depends on the business’s earnings calculation and applicable rules. It is separate from the employee deferral, even when one person makes both. [community]"
  ],
  "howPeopleKeepIt": [
    "**A provider login and a profit number.** [community]"
  ],
  "howItFeels": [
    "**Like HR, but they are HR.** [community]"
  ],
  "howLongPeopleRunIt": [
    "**While the shop is theirs.** [community]"
  ],
  "deepDive": [
    "**Separate the plan’s features:** employee and employer contributions, Roth tax treatment and any permitted after-tax conversion route are different questions. A provider’s solo-plan label does not mean every optional feature is available. [community]"
  ],
  "watchForLong": [
    "**Recheck the plan after hiring:** eligible employees can change whether the owner-only arrangement remains appropriate and what administration is required. [community]"
  ],
  "related": [
    "the-match",
    "roth-vs-traditional",
    "mega-backdoor-roth",
    "rsus-espp"
  ],
  "researchPointer": [],
  "housePointers": [],
  "playPointer": null,
  "sources": [
    "r/personalfinance solo 401k vs SEP",
    "self-employed retirement threads"
  ],
  "disclaimer": "Community talk may be wrong. Not financial, tax, legal, or investment advice. No return or outcome is promised.",
  "quickAnswerHistory": [
    {
      "field": "commonPicture",
      "rows": [
        {
          "lead": "Two hats",
          "why": "Employee deferral plus employer contribution stories. [community]"
        }
      ]
    },
    {
      "field": "definition",
      "rows": [
        "A solo 401k is a one-participant retirement plan for self-employed people, with employee and employer contribution hats."
      ]
    },
    {
      "field": "communityPicture",
      "rows": [
        "People leaving a W-2 compare it with a SEP IRA, miss deadlines, and keep books clean enough that a tax person can see the profit."
      ]
    },
    {
      "field": "firstLine",
      "rows": [
        "A solo 401k is the self-employed cousin of the workplace plan — employee plus employer hats, then the usual match/Roth fights without HR."
      ]
    },
    {
      "field": "whyLine",
      "rows": [
        "A solo 401k is the self-employed cousin of the workplace plan — employee plus employer hats, then the usual match/Roth fights without HR."
      ]
    },
    {
      "field": "commonPicture",
      "rows": [
        {
          "lead": "No employees (except maybe a spouse)",
          "why": "That is the ‘solo’. [community]"
        },
        {
          "lead": "Two contribution roles: employee and employer",
          "why": "The owner can contribute in both roles when eligible; the amounts use different rules. [community]"
        },
        {
          "lead": "A provider, not a spreadsheet IRA",
          "why": "Fidelity / similar individual 401k. [community]"
        },
        {
          "lead": "Profit first",
          "why": "Employer share needs a real net. [community]"
        },
        {
          "lead": "2026 employee deferral limit: $24,500 before catch-ups",
          "why": "This limit is shared with other 401(k)/403(b) employee deferrals. [community]"
        },
        {
          "lead": "2026 overall additions limit: $72,000, limited by eligible earnings",
          "why": "Employee and employer contributions share that total; qualifying catch-ups are separate. [community]"
        }
      ]
    },
    {
      "field": "watchFor",
      "rows": [
        "Employees other than a spouse. Deadline traps. Not a SEP-only religion. Not advice."
      ]
    },
    {
      "field": "howPeopleRunIt",
      "rows": [
        "**They keep the match-of-one honest** — books, not vibes. [community]"
      ]
    },
    {
      "field": "amountsPeopleUse",
      "rows": [
        "**Employer percent-of-net** is the second lever — tax person, current year. [community]"
      ]
    },
    {
      "field": "deepDive",
      "rows": [
        "**The match / Roth vs Traditional / mega backdoor** still apply as ideas. [community]"
      ]
    },
    {
      "field": "watchForLong",
      "rows": [
        "**Hiring someone and keeping a solo plan on vibes.** [community]"
      ]
    }
  ]
}