Can 1099 contractors have a 401(k)?

Short answer

Yes. An independent contractor cannot join an employer's 401(k) for 1099 income, because there is no employer. The account built for that income is a one-participant 401(k), usually called a Solo 401(k). In 2026 the employee deferral is $24,500, and employee plus employer contributions are capped at $72,000 before catch-up.

Who qualifies

You need self-employment income: Schedule C profit, a 1099, or wages you pay yourself from your own business. A Solo 401(k) is for a business with no full-time employees other than the owner and a spouse. A non-spouse employee who becomes eligible ends the solo design.

The IRS overview is here: https://www.irs.gov/retirement-plans/retirement-plans-for-self-employed-people.

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

The $24,500 elective deferral is shared across every 401(k) you contribute to in the year. Money you defer at a day job reduces what you can defer into the Solo 401(k). The employer contribution on your self-employment income is separate, up to the $72,000 combined cap.

Solo 401(k) vs SEP IRA vs Roth IRA

A Roth IRA stops at $7,500 ($8,600 at 50+) and has income phase-outs. A SEP IRA is employer money only, about 20% of net self-employment earnings for a sole proprietor, capped at $72,000. A Solo 401(k) adds the employee deferral on top of a similar employer contribution, which is why it usually allows more at moderate incomes. None of these is automatically the right account.

How to open one

A sole proprietor can often use an SSN. An EIN is required if the plan covers employees or if the business is an entity that already has one. You adopt a plan document. For 2026 employee deferrals, the plan generally has to be in place by December 31. Employer contributions can often wait until the tax filing deadline, including extensions. Confirm the deadline for your entity with a tax professional.