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SEP IRA Contribution Calculator

Estimate SEP IRA contribution limits and tax impact for self-employed individuals.

Self-Employment Details

Net Self-Employment Income

Business Expenses Deducted

Filing Status

Age

Other Retirement Contributions

Federal Tax Bracket

SEP IRA for Self-Employed Individuals

A Simplified Employee Pension (SEP) IRA allows self-employed individuals and small business owners to contribute significantly more to retirement than a traditional or Roth IRA. For 2026, you can contribute up to an effective 20% of adjusted net self-employment income, with a maximum of $72,000.

How the Contribution Is Calculated

The SEP IRA contribution formula has a nuance that trips up many freelancers. You calculate 25% not of your gross income, but of your net self-employment income after subtracting half of your self-employment tax. This effectively reduces the contribution percentage to about 20% of your net SE income before the SE tax deduction.

SEP IRA vs. Traditional IRA

A traditional IRA limits contributions to $7,500 per year ($8,600 if age 50+). A SEP IRA allows up to $72,000. For a freelancer earning $150,000, a SEP lets you shelter several times more income from taxes. The tax savings compound dramatically over time.

Key Rules and Deadlines

Contributions are due by your tax filing deadline (including extensions)
You can open and fund a SEP IRA for the previous tax year until April 15 (or October 15 with extension)
All contributions are employer contributions (made by your business to your account)
No catch-up contributions for age 50+ (unlike 401(k) plans)
SEP IRA funds can be rolled into a traditional IRA or Solo 401(k) at any time

When to Consider a Solo 401(k) Instead

If you want to maximize retirement savings beyond what a SEP allows, a Solo 401(k) may be a better option. It adds an employee contribution ($24,500 / $32,500 if 50+) on top of the employer contribution, potentially allowing a higher total contribution. However, it requires more administration and must be established before December 31 of the tax year.

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How to Use the SEP IRA Contribution Calculator

1
Enter your values
Open the SEP IRA Contribution Calculator and fill in the required input fields with your numbers or selections.
2
Review the calculation
The tool automatically computes the result as you type. Double-check your inputs to ensure accuracy.
3
Interpret your results
Review the calculated output along with any breakdowns, charts, or explanations provided to understand what the numbers mean for your situation.

Frequently Asked Questions

What is the SEP IRA Contribution Calculator?

The SEP IRA Contribution Calculator is a free browser-based tool on ConvertCrunch. Estimate SEP IRA contribution limits and tax impact for self-employed individuals. It requires no downloads, installations, or account signups. Simply enter your values and get instant, accurate results. The tool is designed for quick calculations and informed decision-making, whether you are a professional, student, or everyday user looking for reliable answers.

How do I use the SEP IRA Contribution Calculator?

Using the SEP IRA Contribution Calculator is straightforward. Enter your values into the input fields provided on the page, then calculate or adjust parameters to explore scenarios. Most processing happens locally in your browser. If a feature uses a third-party service, the tool identifies that connection and the privacy policy explains it. Most users get the answers they need in under a minute.

Is the SEP IRA Contribution Calculator free to use?

Yes, the SEP IRA Contribution Calculator is completely free to use with no account signup, email requirement, or premium tier. Most calculations run locally in your browser. Features that depend on live data or a third-party service require a network connection and are identified in the tool. You can use it as many times as you need for personal, educational, or professional purposes.

How accurate is the SEP IRA Contribution Calculator?

The SEP IRA Contribution Calculator uses common industry formulas and benchmarks for freelance business planning. Results are based on the inputs you provide and standard assumptions about business expenses and utilization rates. Actual outcomes depend on your market, specialization, geographic location, and negotiation skills. Use results as a baseline and adjust based on your direct experience and local market conditions.

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SEP IRA for Self-Employed Individuals

How the Contribution Is Calculated

SEP IRA vs. Traditional IRA

Key Rules and Deadlines

Contributions are due by your tax filing deadline (including extensions)
You can open and fund a SEP IRA for the previous tax year until April 15 (or October 15 with extension)
All contributions are employer contributions (made by your business to your account)
No catch-up contributions for age 50+ (unlike 401(k) plans)
SEP IRA funds can be rolled into a traditional IRA or Solo 401(k) at any time