Retirement Plans for Solo Entrepreneurs
A guide to maximize your retirement savings up to $83,250 for solo entrepreneurs
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The Langan Financial Group will take their time to learn your goals and help you build a plan that suits your needs.
It is not a cookie cutter system that requires you to fit into a limited number of options.
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Bob, Alex, and their team inspire confidence.
Knowledgeable, personable, service oriented, and highly responsive.
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Owner, Richard Beck LLC
A note about this testimonial: The individuals providing the testimonials above are current clients of Langan Financial and were not compensated for providing their testimonials. The testimonials reflect their individual experiences and are not representative of the experience of all clients.
What is a Solo 401(k) Plan?
A Solo 401(k) is a retirement plan solution for self-employed entrepreneurs.
The IRS refers to this type of plan as a one-participant 401(k) and it works very similarly to a standard 401(k) with profit-sharing.
This plan design is only permissible if the business has no employees (there is one exception we'll get to later).
If the business employs any other workers, they will need to look at other retirement plan options such as:
- SEP IRA
- 401(k)
How to Set Up a Solo 401(k) Plan
The only eligibility requirement for a Solo 401(k) is the participant must be a business owner without any employees (with one exception in the contribution section).
In order to open a Solo 401(k), the employer will need an Employer Identification Number (EIN). The owner will need to review the provisions they want to be included in the plan and incorporate them into the plan document.
As of 2026, a Solo 401(k) generally does not need to file Form 5500-EZ if the total assets of all one-participant plans maintained by the employer do not exceed $250,000 at the end of the plan year.
Once the combined assets exceed $250,000, Form 5500-EZ generally must be filed annually. A final return is also required when the plan is terminated and all assets are distributed, regardless of the plan’s asset value.
How a Solo 401(k) Plan is Taxed
A Solo 401(k) plan could be taxed as a traditional 401(k), reducing taxable income in the year contributions are made. When this is distributed, the participant will pay taxes on the distribution as ordinary income.
The sponsor could also elect for Roth Solo 401(k) contributions, which do not offer an immediate tax deduction but allow for tax-free distributions in retirement.
What are the Solo 401(k) Contribution Limits?
In 2026, a Solo 401(k) allows business owners to contribute up to $72,000 through combined employee and employer contributions.
The maximum may increase to $80,000 for participants age 50 or older and $83,250 for those ages 60–63, depending on compensation and plan provisions.
Business owners can contribute up to $24,500 as an employee and may add an employer profit-sharing contribution.
A spouse who earns income from the business can also participate, potentially allowing a couple to increase their combined retirement savings.
3 Benefits of a Solo 401(k) Plan
1. Customizable Investment Options
A Solo 401(k) plan can have customizable investment options because the plan sponsor is the only participant. They can be any 401(k) acceptable investment.
In a normal 401(k), they may be limited to a fund lineup, but since there is only one participant the fund lineup may be customized to the owner’s preference.
2. Flexible 401(k) Loan Options
3. Minimal Administration Needs
Since a Solo 401(k) plan was created for freelancers, it has minimal paperwork compared to other 401(k) plans aside from the paperwork needed to begin the plan. This is to assist a smaller company with the burden associated with running a retirement plan.
What are the Cons of a Solo 401(k) Plan?
A Solo 401(k) follows many of the same rules as a traditional 401(k). Withdrawals before age 59½ are generally subject to income taxes and an additional 10% federal tax, unless an exception applies.
The business owner is responsible for operating the plan according to IRS requirements. When the combined assets of the employer’s one-participant plans exceed $250,000 at year-end, Form 5500-EZ generally must be filed annually. A final return is also required when the plan is terminated and its assets are fully distributed.
A financial advisor can help monitor the plan, explain its investment and contribution options, and coordinate with the plan administrator and tax or legal professionals. The plan sponsor retains responsibility for compliance and required filings.
Our Solo 401(k) Advisors
If you are considering a Solo 401(k), Langan Financial Group is a fantastic option to help you achieve your retirement plan goals.
In order to strive to provide the best solo 401(k) option, we take a collaborative and engaging approach with employers to align the plan's design with the owner's financial goals.
We provide:
- Regularly scheduled plan reviews
- Regularly scheduled plan benchmarks
- Investment policy statement reviews
- One-on-one financial planning support
Our Solo 401(k) Free Benchmark
Our Solo 401(k) provider services focus on helping your employees better prepare for retirement.
In addition, we will benchmark business 401(k) plans to help ensure it is performing to the best of its ability. We will compare your solo 401(k) plan against other options available.
This free retirement plan review will:
- Review plan fees
- Review vendor services
- Review participant fees
- Review ERISA compliance
- Evaluate portfolio performance
Get started today
Contact Us Today
Chat with a Solo 401(k) Advisor
Give us a call at 717-288-1880 to see how our local advisors can help with your retirement plans.
Or visit our solo 401(k) advisor contact page to fill out an inquiry.
FREE Benchmark Comparison Services
Financial Advisor Locations:
Camp Hill, PA Financial Planning Office
York, Pa Financial Planning Office
Harrisburg, PA Financial Planners
Communities Served:
Langan Financial Group, LLC ("Langan Financial Group" or "LFG") is an SEC registered investment adviser. SEC registration does not constitute an endorsement of the firm by the Commission nor does it indicate that the adviser has attained a particular level of skill or ability. LFG may only transact business in those states in which it is registered, or qualifies for an exemption or exclusion from registration requirements.
You can review our registration and disciplinary history on the SEC's Investment Adviser Public Disclosure (IAPD) website and, for brokerage registrations, on FINRA's BrokerCheck. This website is for general information only. It is not legal, accounting, or tax advice. Please talk with your own legal or tax professional about your situation. Important information about our firm is on our Disclosures page.
© Langan Financial Group
Harrisburg, PA Office
Address: 1863 Center St, Camp Hill, Pa 17011
Phone: 717-288-1880
York, PA Office
Address: 3405 Board Rd, Suite 200, York, Pa 17406
Phone: 717-773-4085
