Contributions Guide

Understand the two types of contributions

You can make two types of contributions to your Solo 401k- employee and employer

As a self-employed individual, you are both employee and employer
Employee contributions are also called salary or elective deferrals
Employer contributions are also called profit sharing contributions
Each type is calculated differently
Both are based on your compensation

Start with your compensation

Your contributions to your Solo 401k must be based on your compensation from the adopting business of your Solo 401k.

Compensation must come from the adopting business of your Solo 401k, not from an outside company or source
Compensation is what the adopting business is paying you
Compensation is subject to self-employment or payroll taxes
You cannot contribute more than what you earn in compensation

Defining compensation

Know your contribution deadlines

Your contribution deadlines depend on:

The tax status of the adopting business of your Solo 401k
The type of contribution you are making

Examples of tax statuses:

Sole proprietorship (or LLC taxed as a sole proprietorship)
Partnership (or LLC taxed as a partnership)
S-corporation (or LLC taxed as S-corporation)
C-corporation (or LLC taxed as C-corporation

For employee contributions

Adopting businesses with tax status of a partnership can make employee contributions to the Solo 401k by the business’s tax filing deadline, including extension
Adopting businesses with tax status of corporation can make employee contributions to the Solo 401k by the end of the taxable year because the employee contributions must be processed through payroll
Adopting businesses with tax status of sole proprietorship can make employee contributions to the Solo 401k by the business’s tax filing deadline, no extension(April 15)

For employer contributions

All adopting businesses can make employer contributions to the Solo 401k by the business’s tax filing deadline, including extension

Deadlines for making contributions

Calculate your contributions

For 2025

Type	Maximum	Additional Info
Employee	$23,500
	For age 50+, $7,500 catch-up	Catch-up can be made as pre-tax or Roth, but if you are a higher-paid employee, the catch-up must be made as a Roth https://clients.sensefinancial.com/mandatory-roth-catch-up-contributions/
	For age 60-63 by end of 2025, $11,250 catch-up	Catch-up can be made as pre-tax or Roth, but if you are a higher paid employee, the catch-up must be made as a Roth https://clients.sensefinancial.com/super-catch-up-contributions/ https://clients.sensefinancial.com/mandatory-roth-catch-up-contributions/
After-tax	$70,000	https://clients.sensefinancial.com/after-tax-contributions/
Employer	20% for tax status: sole proprietorship 25% for tax status: corporation	Can be made as pre-tax or Roth https://clients.sensefinancial.com/employer-roth-contributions/
TOTAL	$70,000 $77,500 (incl catch-up for age 50+) $81,250 (incl catch-up for 60-63 by end of 2025)	Your total contributions to the Solo 401k for this year cannot exceed this maximum

Employee contribution maximum is per person, not per plan. If you have reached the employee contribution maximum in another 401k you are in, you will not be able to make an additional employee contribution to the Solo 401k.
Employer contribution maximum is per plan

Check with your CPA

All calculations should be checked with your CPA. The limits given on this page constitute general
guidance only.

Document your contribution elections

You must document the election to make the contribution using our contribution forms
The completed and signed contribution form is kept in your file only as Plan Administrator of your Solo 401k. These forms are part of your recordkeeping and are not submitted to anyone else.
The form must be dated by the last day of the year (e.g. December 31st) for which the contribution is being made

Contribution forms

If your adopting business has payroll, process
your employee contributions through payroll

If the tax status of the adopting business is:

Corporation: you are required to have payroll
Another type that has chosen to have payroll

Then your 401k employee contributions must be first processed by payroll

You must request this with your payroll provider before the end of the year, when your payroll is run
If payroll has already been run for the year, the only option is to amend the Q4 reports to reflect the contributions to the 401k. Keep in mind that contributions will affect the taxes paid as well as other numbers. Speak with your payroll provider about making this correction.
Your payroll provider may or may not move the funds for the contribution for you, depending on their service. They may process the contribution only, not make the contribution itself.

Contributions from a corporation

You do not process the contribution by payroll if:

The tax status of the adopting business is not a corporation
The tax status of your adopting business is not a corporation and you do not have payroll
You are making an employer contribution. Employer contributions are not processed by payroll.

Make your contributions

Employee and employer contributions must be made from the adopting business’s bank account to the Solo 401k
After-tax contributions are made from your personal bank account, after receiving compensation from the adopting business
Contributions must be made by their respective deadlines
Once contributions are processed by payroll, the funds must be deposited to the Solo 401k within 7 business days

Report your contributions