Can I have both a SEP-IRA and a Solo 401(k)?

Generally no — you can only contribute to one or the other in the same year for the same business. However, if you have separate businesses, you may be able to maintain both.

How does the SEP-IRA contribution rate work for the self-employed?

The IRS uses a circular calculation: you deduct half of SE tax first, then apply 20% to the net (which effectively equals 25% of net earnings after that deduction).

Is a SEP-IRA better than a Solo 401(k)?

A Solo 401(k) allows higher contributions at lower income levels and permits employee deferrals. A SEP-IRA is simpler with less paperwork. At high incomes, both reach the same $69,000 cap.

When is the SEP-IRA contribution deadline?

Contributions can be made until the tax filing deadline including extensions — typically October 15 for most self-employed individuals, making it flexible if your income is uncertain.

SEP-IRA Calculator

By the KalkWise Editorial Team Reviewed for accuracy Updated June 2026

What is the sep-ira calculator?

In short

For 2024, self-employed individuals can contribute up to 25% of net self-employment income (after the SE tax deduction), capped at $69,000. On a $100,000 gross income, net SE income is $92,350, so the max contribution is about $18,470.

Calculates your maximum SEP-IRA contribution based on self-employment income and projects your retirement balance using compound growth over your contribution period.

How to use this calculator

1Enter your gross self-employment income (before any deductions).
2Enter your current age and the number of years until you plan to retire.
3Set your expected annual investment return (7% is a common long-term estimate).
4See your maximum annual contribution and projected retirement balance.

The formula

netSE=G×0.9235

C=min(netSE×20%,$69,000)

FV=C×(1+r)n−1r×(1+r)

C = min(G × 0.9235 × 0.20, 69000); FV = C × ((1+r)^n − 1) / r × (1+r)

G: — Gross self-employment income
netSE: — Net SE income = G × 92.35%
C: — Max contribution = min(netSE × 20%, $69,000)
r: — Annual return rate
n: — Years to retirement
FV: — Future value of contributions

Worked example

The scenario

$100,000 gross income, 20 years to retirement, 7% return.

gives

The result

Net SE income: $92,350. Max contribution: $18,470/year. Projected balance: ~$757,000.

Common use cases

Freelancers and independent contractors maximizing retirement savings.
Small business owners with no employees wanting a simple retirement plan.
Self-employed professionals comparing SEP-IRA vs Solo 401(k) contribution limits.

Limitations & assumptions

Assumes constant annual income — varies with business performance.
Does not account for the SE tax deduction used to compute net SE income for the exact IRS calculation.
Projection does not account for inflation or variable returns.

Frequently asked questions

The 2024 SEP-IRA limit is the lesser of 25% of net self-employment income or $69,000. For employees, it's 25% of W-2 wages up to $69,000.

Disclaimer: KalkWise calculators are provided for general informational and educational purposes only and do not constitute financial, investment, tax, or legal advice. Results are estimates based on the figures you enter and the assumptions described above. Actual outcomes will vary. Consult a qualified professional before making financial decisions.

Your details