Solo 401(k) for 1099 associate dentists

This page is general education, not individualized investment or tax advice. Your plan documents and your preparer have the final word.

A 1099 associate is a business owner in the IRS’s eyes. That means you can set up your own retirement plan, and the solo 401(k) is usually the one with the most room.

Who qualifies

The IRS calls it a one-participant 401(k). It’s for “a business owner with no employees, or that person and his or her spouse.”

For most 1099 associates, that fits. Your business is you, paid by the practice on a 1099. The practice’s hygienists and assistants are its employees, not yours.

You need self-employment income to contribute. If you later hire staff of your own, a solo plan stops fitting, because the plan would have to cover eligible employees.

2026 contribution limits

Figures for 2026, per IRS Publication 560:

Limit	2026
Employee elective deferral	$24,500
Catch-up, age 50 and over	$8,000
Higher catch-up, ages 60 to 63	$11,250 (in place of $8,000)
Total contributions, not counting catch-up	$72,000
Maximum compensation counted	$360,000

Few new associates need the catch-up rows. They’re here for completeness.

Two ways in: employee and employer

You contribute in two roles, per the IRS.

As the employee, you can defer up to 100% of your earned income, up to $24,500 for 2026.

As the employer, you can add a nonelective contribution. For corporations it’s up to 25% of compensation. For sole proprietors and single-member LLCs, the special calculation in Pub. 560 works out to 20% of net earnings from self-employment, figured after deducting half your SE tax.

The employer contribution is where a 1099 associate gets room a W-2 associate can’t.

The math: a full-time 1099 associate

Assumptions: 2026, sole proprietor, $150,000 of net profit on Schedule C, no W-2 job, under age 50.

Step	Math	Amount
SE tax	$150,000 × 92.35% × 15.3%	about $21,190
Half of SE tax	deductible	about $10,600
Base for employer contribution	$150,000 − $10,600	about $139,400
Employer contribution	20% of the base	about $27,880
Employee deferral	2026 limit	$24,500
Total	under the $72,000 cap	about $52,380

Pre-tax contributions lower your AGI, and on RAP that lowers your payment. See taxes for 1099 associate dentists for how AGI flows into RAP.

If you also have a W-2 job with a 401(k)

Plenty of associates work W-2 at one office and 1099 at another. The IRS is blunt about the limit: deferral limits “are by person, not by plan.”

So the $24,500 is shared. If you defer $24,500 at your W-2 job, you have no deferral room left in a solo 401(k).

You can still make the employer contribution on your 1099 earnings.

Example. W-2 pay of $120,000 at practice A, where you defer the full $24,500. Net 1099 profit of $60,000 at practice B. SE tax is about $8,480; subtract half of it and the base is about $55,760. The employer contribution is 20% of that, about $11,150.

Two plans raise questions about the overall cap and the Social Security wage base. Confirm your numbers with the plan provider or a preparer.

Roth option

Pub. 560 explains that a plan can let you designate deferrals as Roth. Roth contributions go in after tax, so they don’t lower AGI this year.

SECURE 2.0 also allows certain employer contributions to be designated Roth, if the plan offers it. Fidelity’s plan, for example, allows Roth for deferrals only.

For an associate on RAP, the choice has a second side. Traditional deferrals lower AGI and your payment. Roth deferrals don’t.

Form 5500-EZ

You generally file Form 5500-EZ once plan assets are more than $250,000 at year end, per Pub. 560. At $250,000 or less, Pub. 560 says you don’t have to file.

Pub. 560 adds that every one-participant plan should file for its final plan year. Put it on your calendar once your balance gets close.

Where to open one: brokerage plans vs self-directed providers

Two kinds of providers. Prices and terms as of Sept. 26, 2026, from each company’s own site.

Provider	Setup and ongoing cost	Roth deferrals	Loans	Form 5500-EZ help
Fidelity	“No account fees”: no opening, closing or annual fee	Yes, deferrals only	Not offered	Not listed; its page says most owner-only plans file once assets exceed $250,000
Nabers Group	$499 setup, $29 a month	Check with provider	Advertises a “line of credit up to $50,000”	“Form 5500-EZ preparation” included
Sense Financial	$800 setup, $250 a year from year two	Check with provider	Loan procedures in plan documents	“Guidance” on 5500-EZ and 1099-R
Rocket Dollar	$900 setup, $50 a month	Roth and traditional in one account	401(k) loan option	Check with provider

We’re not paid by Fidelity. Schwab and Vanguard are other names people check, but we couldn’t confirm their current terms on their sites on Sept. 26, 2026.

Brokerage plans like Fidelity’s hold stocks, bonds and funds. For most associates who want index funds, a no-fee plan does the job.

Self-directed providers let the plan hold real estate, private loans, crypto and other alternatives. Sense Financial and Rocket Dollar both list real estate among allowed assets.

That flexibility costs money and adds risk. Pub. 560 has a section on prohibited transactions, and self-dealing with plan money is where people get into trouble.

Who it’s wrong for

• Tiny or one-time 1099 income. A few thousand dollars of moonlighting may not justify a plan. An IRA may be simpler.
• Anyone paying monthly fees for features they won’t use. Over 10 years, $29 a month is $3,480; $50 a month is $6,000.
• Associates who haven’t built an emergency fund. Money in a 401(k) is hard to reach before retirement. See high-yield savings for dentists.

What to do next

1. Confirm you have 1099 income and no employees of your own.
2. Estimate your room with the table above, or ask a preparer to run it.
3. Pick the provider type. Index funds only: a no-fee brokerage plan. Real estate or private deals: compare Nabers and Rocket Dollar on cost and features.
4. Decide Roth or traditional with RAP in mind. See investing while paying off dental debt.
5. Watch the $250,000 line for Form 5500-EZ.