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SEP IRA for Self-Employed: Rules, Limits & Setup
SEP IRA contribution limits, tax benefits, and how sole proprietors and small businesses can save for retirement.
July 9, 20267 min readBy MyWealthForge
Key Takeaways
- 1Contribute up to 25% of net self-employment income (max ~$69,000 in 2025).
- 2Easy to set up — one form at any brokerage.
- 3Must contribute same % for all eligible employees.
- 4No Roth option — all pre-tax.
SEP IRAs are the simplest retirement plan for solopreneurs — high contribution limits with minimal paperwork.
Compare solo 401(k) if you want Roth and employee deferrals.
Who SEP IRA Fits
Sole proprietors, freelancers, businesses with few or no employees.
Contribution = 25% of net self-employment income.
SEP vs Solo 401(k)
SEP: simpler, no employee deferral. Solo 401(k): higher limits at lower income, Roth option.
Plan quarterly taxes with contributions.
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