OnePerson(k): Flexible plan for solo practitioner

A Solo 401(k) often used in combination with a Defined Benefit plan

This plan is a good option for self-employed owner-only companies, or an owner and spouse if they need the flexibility of making optional contributions each year. These plans may be used in combination with a Defined Benefit plan to increase contribution amounts and flexibility of the DB plan.

CALCULATE HOW MUCH YOU COULD CONTRIBUTE

How It Works

A OnePerson(k) is a retirement savings plan specifically designed for self- employed business owners (including sole proprietorships, corporations, and limited liability corporations). Typically, it allows for higher contributions than a SEP or SIMPLE plan while providing the same tax benefits of a regular 401(k) without the high costs and standard employer/employee structure. The plan combines the features of a 401(k) plan and a Profit Sharing plan.

These plans allow the business owner and spouse to make discretionary profit sharing contributions up to 25% of compensation.
In addition, each participant may make salary deferrals to the OnePerson(k) that equal the lesser of 100% of compensation or $24,500.
For 2026, the aggregate contribution limit for the profit-sharing contribution and the elective deferrals cannot exceed the lessor of 100% of compensation or $72,000 (plus an additional $8,000 in “catch-up” contributions if age 50 or over). For individuals age 60-63 the super catch-up of up to $11,250 is available.

Once the plan is established, the business owner can open a trust investment account at any financial institution and select any marketable investments.

The OnePerson(k) should be set up by December 31 and at the latest by the business’ tax filing deadline including extensions for the plan year.

View Eligible compensation chart

Combining a OnePerson (k) With a Defined Benefit Plan

I opened a OnePersonPlus Defined Benefit plan and put away $150,000 last year and another $120,000 this year and it’s all a deduction. I figure at least 30% of it is a gift from the IRS.* LEARN MORE ABOUT ONEPERSONPLUS
MORE CLIENT PROFILES

The OwnersPlus Cash Balance Program gives me an extra $200,000 to invest and gives my employees a boost too.* LEARN MORE ABOUT OWNERSPLUS
MORE CLIENT PROFILES

We increased our W-2 income to max out our retirement savings. With a OnePersonPlus Defined Benefit and a 401(k), we’ll add $500,000 each year for the next 5 years.* LEARN MORE ABOUT OnePersonPlus
MORE CLIENT PROFILES

As a realtor, my income is never the same from year to year. With a OnePerson (k), I save about $50,000 in good years but I don’t have to do anything when business is slow.* LEARN MORE ABOUT OnePerson (k)

MORE CLIENT PROFILES

We’re four partners with vastly different needs – our Cash Balance plan is customized to fit us.* LEARN MORE ABOUT OWNERSPLUS
MORE CLIENT PROFILES

Adding a 401(k) to a traditional Defined Benefit plan allows the owner to:

Maximize deductible retirement contributions — the largest contribution of any qualified plan
Increase flexibility — Because the 401(k) contribution is not required each year, the business owner will only contribute in higher income years thus increasing control over total annual contributions. This is an advantage for clients whose income fluctuates from year to year.

When adding a 401(k) to a Defined Benefit plan, the 401(k) contribution is limited to salary deferrals and employer contributions of not more than 6.0% unless the plan is covered by the Pension Benefit Guarantee Corporation (PBGC).

Getting Started

Defined Benefit plans should be opened by 8.5 months of the plan year end to meet minimum funding standards.

If opened after 8.5 months but before the employer's tax return due date, additional excise taxes will be due.