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Retirement Planning

Overview

	IRA Based		Defined Contribution Based		Defined Benefit Plan
	SEP IRA	SIMPLE IRA	Individual (Solo) 401(k)	401(k) Plan
Employer Eligibility	Self-employed individual or small business owner, including those with employees Available to sole proprietors, partnerships, C corporations, S corporations	Businesses with 100 or fewer employees and self-employed individuals Available to sole proprietors, partnerships, C corporations, S corporations	Self-employed individual or business owner with no employees other than a spouse Available to sole proprietors, partnerships, C corporations, S corporations	Any employer with one or more employees.	Any employer with one or more employees.
Key benefits	Easy to set up and maintain Flexible annual funding requirements	Salary deferral plan with less administration	A 401(k) with potentially higher contribution limits than SEP IRA	Permits high level of salary deferrals by employees.	Provides a fixed, pre-established benefit for employees.
2025 employer contribution limits	Up to 25% of compensation up to a maximum of $70,000	Either match employee contributions up to 3% of compensation; can be reduced to 1% in any two out of five years or contribute 2% of each employee's compensation	Employers may contribute up to 25% of compensation up to a maximum of $70,000. Total employer/employee contributions cannot exceed $70,000.	25% of total compensation of all eligible employees	Annually determined contribution.
Who can contribute?	Employer contributions only	Funded by employee deferrals and employer contributions	Funded by employee deferrals and employer contributions	Funded by employee deferrals and employer contributions	Primarily funded by employer.
2025 employee contribution limits	Not applicable	Up to $16,500 in salary deferrals; $20,000 if age 50 or older	Up to $23,500 in salary deferrals; $31,000 if age 50 or older	$23,500 in 2025. Participants age 50 or over can make additional contributions up to $7,500 in 2025.	Primarily funded by employer.
Plan setup deadlines	Establish by employer's tax filing deadline, plus extensions, usually April 15.	Establish by October 1.	Establish by December 31 (or fiscal year-end).	Establish by December 31 (or fiscal year-end).	Establish by December 31 (or fiscal year-end).

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