2026 Retirement Contribution Limits for the Self-Employed

Every November the IRS quietly moves the numbers that decide how much of your income can go into a retirement account. Most online business owners I know never look.

I was that person for years. I did not think about retirement at all, so why would I read a limits table? If you run a business with no employees, though, you are the plan sponsor, the employer and the employee. Nobody sends you a reminder. That makes this table yours to read.

What changed in the 2026 retirement limits?

Small bumps across the board, plus one IRA change worth noticing. The IRS announced them in November 2025.¹

Here is the 2026 list, next to where it was in 2025:

• 401(k) employee deferral: $24,500, up from $23,500.
• Catch-up at 50 and over: $8,000, up from $7,500. The special catch-up for ages 60 to 63 stays at $11,250.
• IRA (traditional and Roth combined): $7,500, up from $7,000. The IRA catch-up is $1,100, up from $1,000.¹
• Total defined contribution limit and SEP maximum: $72,000, up from $70,000.²

Limits are ceilings, not goals. A number you cannot fund without borrowing from your operating cash is the wrong number for you this year.

How much can a solo owner actually contribute?

More than most people assume, and with a catch. The IRS describes a one-participant 401(k) as a regular 401(k) covering a business owner with no employees, or that owner and a spouse.⁴

The two hats

You wear two hats. As the employee, you can defer up to 100% of compensation, up to the annual deferral limit. As the employer, the plan can add a nonemployer contribution of up to 25% of compensation. The total, excluding catch-up, cannot go past the overall annual limit, which is $72,000 for 2026. With catch-up the IRS shows $80,000, or $83,250 for ages 60 to 63.³

Brian Preston and Bo Hanson of The Money Guy Show explained who qualifies in a video posted on February 22, 2024:

The dollar figures in that video are 2024's, so use the 2026 numbers in this article. The structure and the cautions about shared deferral limits still hold.

Plays here, from YouTube

The self-employed twist

For a sole proprietor, "compensation" is not your revenue. The IRS says it means net earnings from self-employment after you deduct half of your self-employment tax and the contributions you make for yourself, so a special calculation is needed.⁴ That is why a percentage headline never matches the real number. Do this math with a tax professional or your plan provider, not on a napkin.

One housekeeping item: a one-participant plan generally has to file Form 5500-EZ once its assets reach $250,000 at year end.⁴

Solo 401(k) or SEP IRA?

They solve different problems. Neither is a recommendation, just a map.

The SEP page from the IRS states plainly that elective salary deferrals and catch-up contributions are not permitted in SEP plans.⁵ The employee part of a solo 401(k) is what lets a lower-income year still produce a meaningful contribution. That is a structural fact, not advice.

Does the new Roth catch-up rule affect self-employed people?

Possibly not yet, and not in 2026. In September 2025 the Treasury and IRS issued final regulations on a SECURE 2.0 rule. Catch-up contributions by certain higher-income participants must be made as after-tax Roth contributions. The rules generally apply to taxable years beginning after December 31, 2026.⁶

I have not seen the IRS release spell out how it applies to a sole proprietor, so I will not guess. The question to ask your plan provider this year is simple: "Does the Roth catch-up requirement apply to me, and does the plan document allow it?" Ask before 2027, not after.

What about Roth IRAs and HSAs?

Two more doors, each with its own gate.

Roth IRA income limits

The Roth IRA contribution phase-out for 2026 starts at $153,000 and ends at $168,000 for single filers, and runs from $242,000 to $252,000 for married couples filing jointly.¹ Your contribution also cannot exceed your taxable compensation for the year.⁸

HSA limits

For people with a qualifying high deductible health plan, the 2026 Health Savings Account limits are $4,400 for self-only coverage and $8,750 for family coverage.⁷ Whether you qualify depends on the plan you hold, so confirm that first. Health insurance for founders is its own topic, and I will return to it.

How do uneven income years change the plan?

Online business income is lumpy. A launch month can pay for a quiet quarter, and the reverse happens too. A fixed monthly contribution that feels easy in March can feel heavy in July.

This is where the solo 401(k) structure helps in theory: part of it is a percentage of what you actually earn, and part is a choice you make year by year. The cleaner habit is to contribute from profit that has already landed, not from revenue you expect. Booked revenue pays nobody, and it does not fund an account either.

I have never taken a loan for my business or used a credit card for business needs, and I have always stayed liquid. That is what makes a contribution safe to make. Build your plan so a slow month never forces you to choose between a bill and a deposit.

What should you do before the next deadline?

Treat it like any other operating decision.

My grandmother asked me one question that made me read tables like this one, and you can find that story here. Every online owner I talk to has a number they chase for the business. Fewer have one for their later years. Pick yours.

More guides for operators in this stage live in the Investing and Retirement hub.

Educational content, not financial, tax, legal or investment advice. Talk to a licensed professional about your situation.

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