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Free New 2025 Limits Self-Employed Planning

Self-Employed Retirement
Plan Calculator

Compare SEP-IRA, Solo 401(k), SIMPLE IRA, Traditional IRA, and Roth IRA side-by-side. Plug in your self-employment income or S-Corp W-2 wages, see the maximum contribution each plan allows, and the tax savings at your marginal rate. Using current 2025 IRS contribution limits.

💡 For S-Corp owners: Your retirement contribution is capped by your W-2 wages, not S-Corp distributions. Paying yourself a higher reasonable comp (see RCC) directly raises your Solo 401(k) and SEP-IRA contribution ceiling — a bonus benefit of moving comp into wages.

Your Situation

Schedule C / SE income
Age 50+ unlocks catch-up contributions.
Combined federal + state for accurate savings.
Also have a W-2 job?
401(k) elective deferral limit ($23,500) is shared across all employers — affects Solo 401(k).
Have non-spouse employees?
Disqualifies Solo 401(k). Affects SEP-IRA (must cover them) and SIMPLE IRA (must offer to all).
Apply catch-up if 50+
Adds $7,500 (401k) or $3,500 (SIMPLE) or $1,000 (IRA) for age 50+.

Tactical notes for choosing a plan

  1. If you're a one-person operation maximizing tax-deferred savings: Solo 401(k) wins. The elective deferral ($23,500) layered on top of the 20%/25% employer contribution lets you stack more than SEP at most income levels. Setup is more complex (one-time custodian agreement) but the ceiling is higher and Roth contributions are available.
  2. If you want the simplest possible setup: SEP-IRA. One-page IRS Form 5305-SEP, no annual filings (vs Form 5500 for Solo 401(k) over $250K assets), contributions vary year-to-year. Tradeoff: no Roth option, no catch-up provision, no elective deferral.
  3. If you have a few employees you want to include: SIMPLE IRA. The setup is easy AND covers employees with an automatic match — Solo 401(k) is off the table once you have non-spouse employees. SEP-IRA also works but requires the same % contribution for employees as for the owner.
  4. For S-Corp owner-employees: your contribution ceiling is your W-2 wages, not your S-Corp profit. If you pay yourself $50K W-2 and take $200K in distributions, your retirement contribution ceiling is based on the $50K — not the $250K of total comp. The Reasonable Compensation Calculator can help you find a defensible higher W-2 number, which directly raises this ceiling.
  5. The traditional/Roth split matters more than the plan choice. If you're in a high bracket now and expect lower in retirement: traditional (current deduction). If lower bracket now (early-career) and expect higher later: Roth (tax-free growth). The Solo 401(k) Roth option is underused — same contribution limits as traditional, just with the Roth tax treatment.
  6. The Backdoor Roth still works. If your income is above the Roth IRA direct-contribution phase-out ($146K–$161K single, $230K–$240K MFJ for 2025), you can still get money into Roth by making a non-deductible Traditional IRA contribution and converting. Note the pro-rata rule if you have other pre-tax IRA balances — discuss with your preparer.
Related Tools
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Reasonable Compensation Calculator (S-Corp)— Find your defensible W-2 number; higher comp = higher retirement contribution ceiling
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S-Corp Audit Exposure Calculator— What underpaying yourself costs if the IRS reclassifies distributions
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QBI Deduction Calculator (§199A)— Retirement contributions reduce taxable income, may keep you below the QBI threshold
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Self-Employment Tax Calculator— Schedule SE math: 15.3% on net SE income
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Federal Tax Estimator— Full 2025 federal tax computation
⚠️ Methodology & 2025 limits
2025 IRS limits used: Defined-contribution maximum $70,000 (SEP-IRA, Solo 401(k) employer side). 401(k) elective deferral $23,500. SIMPLE IRA elective deferral $16,500. IRA contribution $7,000. Age-50 catch-up: $7,500 (401k), $3,500 (SIMPLE), $1,000 (IRA). Compensation cap $350,000.

SEP-IRA math: For sole proprietors / partnerships, contribution = (Net SE income − ½ SE tax) × 20% = effectively 18.587% of net SE earnings. For S-Corp shareholder-employees, contribution = 25% of W-2 wages (because no SE tax adjustment). Capped at $70K.

Solo 401(k) math: Employee elective deferral $23,500 + employer-side contribution at 20% (sole prop) or 25% (S-Corp W-2). Total cap $70K. Plan eligibility requires no non-spouse employees.

This calculator is a planning estimate. For your specific situation, especially with W-2 employees, Backdoor Roth conversions, or after-tax 401(k) "mega backdoor" contributions, consult your tax professional. Plan administrators handle the actual paperwork (Form 5500 for Solo 401(k), Form 5305-SEP for SEP-IRA, Form 5305-SIMPLE for SIMPLE IRA).