If you’re new to entrepreneurship — or a seasoned business owner — you may not realize that your business can sponsor its own IRS-qualified retirement plan. A Solo 401(k)allows self-employed individuals and business owners with no full-time employees to build retirement wealth while reducing current-year taxes. 

One of the biggest advantages?
If you’re leaving an employer, you can transfer (roll over) your existing 401(k) into your own company’s Solo 401(k). This helps you avoid unnecessary taxes and early-withdrawal penalties while keeping your retirement savings working for you.

Not leaving your employer? No problem.
You can still establish a Traditional or Roth Solo 401(k) through your business, as long as you do not exceed the IRS annual contribution limits across all plans.

What Does a Solo 401(k) Do?

A Traditional Solo 401(k) allows you to:

• Exclude  income from current-year taxation
• Defer  taxes until retirement
• Build  long-term retirement wealth
• Maintain emergency access through participant loans of up to 50% of the account balance, subject to IRS rules.

** Loan repayments are generally due within 5 years. If the loan is not repaid on time, the outstanding balance is treated as a taxable distribution.

What Can It Save Me in Taxes?

Solo 401(k) plans offer significantly higher contribution limits than traditional IRAs. Depending on the tax year and your income, you may be able to defer tens of thousands of dollars in taxable income annually through employee and employer contributions.

This makes the Solo 401(k) a powerful tool for:

• Business owners with fluctuating income
• High earners looking to reduce tax liability
• Entrepreneurs building long-term wealth efficiently

What Can I Invest In?

With a Traditional Solo 401(k) held at a brokerage, you may invest in:

• Stocks
• Bonds
• ETFs
• Mutual funds
• Commodities
• Other market-based securities

If you choose a Self-Directed Solo 401(k), your investment options may expand to include:

• Real estate
• Private businesses
• Alternative assets
• Other IRS-permitted investments

What If I Already Have Other Retirement Accounts?

Contributions to other retirement accounts, such as IRAs, do not reduce your Solo 401(k) contribution limit. This allows business owners to strategically combine:

• Solo 401(k) plans
• Traditional IRAs
• Roth IRAs

Why Do I Need a Solo 401(k)?

Retirement plans are a core component of smart tax planning.

While IRAs are useful, early access often triggers penalties. A Solo 401(k) offers:

• Higher contribution limits
• Greater tax flexibility
• Potential loan access without early withdrawal penalties

For many business owners, the best strategy is a mix of 401(k), Traditional IRA, and Roth IRA planning.

Solo 401(k) Setup Service

One-Time Setup Fee: $895

This includes:

• Establishment  of an IRS-approved Solo 401(k)
• Placement at a brokerage account (no stock-picking required)
• Ability to start the account with as little as $50
• Assistance with rolling over existing 401(k) funds
• Education on participant loan rules and repayment requirements

Your money remains in a brokerage account — you’re not required to actively invest unless you choose to.

Solo 401k Contribution Calculator allows you to calculate the maximum amount you can contribute to your plan. Click on the link below, enter requested info below and click the “Submit” button to see your results. A PDF document will be generated with the option for you to save or print it.  It is very important that you select the correct business type; please note that Sole-Proprietor is selected by default (if your business is a single member LLC, select the Sole-Proprietor type).  

For a solo 401k calculator to estimate how much you can contribute, click HERE.