A Retirement Benefit You Can Offer Subcontractors Without Sponsoring a Plan

The owner's dilemma

You run a business with no W-2 employees and a bench of subcontractors you rely on: a general contractor with six trades, a marketing agency with a stable of freelancers, a medical practice that uses locum coverage, a logistics company with owner-operators. You would like to help them save for retirement. You also know, or your accountant has told you, that anything resembling an employee benefit is a problem.

Both instincts are right. The way to reconcile them is to offer a resource the subcontractor owns rather than a plan you sponsor, and the Gigaverse business owner program is built for exactly that. This article explains why a sponsored plan is the wrong tool, what the right one looks like, and how to talk about it.

Why you cannot just add them to your plan

If you have a Solo 401(k), its status as a one-participant plan depends on your business having no common-law employees other than you and your spouse. Contractors do not count, so paying them does not disqualify you. But enrolling them would, because the only way a person can participate in a 401(k) is as an employee of a participating employer. You would be asserting that they are employees.

If you have a SEP, the same logic applies. SEP eligibility is defined in terms of employees. Contributing for a contractor is a statement that the contractor is an employee.

The state mandates make the same distinction. CalSavers reaches every California employer with one or more W-2 employees as of January 1, 2026, and excludes contractors (https://gusto.com/resources/states/retirementmandates). If your only workers are subcontractors, you are not subject to the mandate, and you should not do anything that suggests you ought to be.

What "benefit" can mean without a plan

There is a version of a retirement benefit that has none of the employment markers.

Information. Telling your subcontractors that, as sole proprietors, they can open a Roth IRA ($7,500 limit in 2026) or adopt a Solo 401(k) for their own business with a $24,500 employee deferral plus roughly 20 percent of net self-employment earnings as an employer contribution, up to $72,000 ($80,000 at 50 and older). Most have never heard this. Only 15 to 18 percent of self-employed people use a Solo 401(k) (https://www.solo401k.com/blog/solo401k-adoption-growth-statistics-usa).

Access. Pointing them to an app that computes those limits from their own numbers, tracks contributions, and hands the result to their preparer.

Seats. If you want to go further, buying app seats for your subcontractors at a flat per-seat licence fee. The subcontractor still owns and funds the account. You are paying for software they use, the same way you might pay for a shared scheduling tool or a safety-training subscription. You are not contributing to a retirement account, not deducting from payments, and not sponsoring anything.

A rate increase. If you want money to flow, raise the contract rate. That is a contractor-appropriate action. What you must not do is earmark the increase, route it, or condition it on the subcontractor saving it.

What to avoid

• •Matching. Any payment into a subcontractor's retirement account is an employer contribution in substance.
• •Deducting. Withholding from an invoice payment resembles payroll deduction.
• •Conditioning. Requiring enrollment to keep getting work is control.
• •Benefit language. "Our subcontractors get retirement benefits" is a sentence to avoid in your marketing, your contracts, and your recruiting.
• •Per-enrollee payments to you. If you were paid each time a subcontractor opened or funded an account, the payment would look like transaction-based compensation under Exchange Act Section 15(a) and FINRA Rule 2040, and a share of advisory fees would violate the rule that an SEC-registered adviser cannot share fees with unregistered parties. Gigaverse pays business owners only a share of revenue on paid app subscriptions or a per-seat licence arrangement, discloses that to the subcontractor as SEC Marketing Rule 206(4)-1 requires above $1,000 in twelve months, and notes that some states require paid solicitors of advisory clients to register as investment adviser representatives. Details are on the how we make money page.

How to talk about it

To your subcontractors: "You run your own business, which means you have retirement options most people do not know about. Here is an app built for 1099 income that figures out how much you can put away and where. It is yours, it is optional, and we do not contribute to it or take anything out of your payments for it. If you use it, tell your tax preparer, because the numbers go on your return."

To your accountant: "We are making a third-party retirement resource visible to our subcontractors. We are not sponsoring a plan, contributing, or deducting. If we buy seats, it is a software licence. Please confirm the classification analysis is unaffected."

To yourself: the legal position that keeps you safest is that your subcontractors are independent businesses. Handing them tools built for independent businesses reinforces that position. It is one of the few retention moves that helps rather than hurts on classification.

What the subcontractor can do with it

A subcontractor netting $80,000 can shelter about $39,300 in 2026 through a Solo 401(k) (the $24,500 deferral plus roughly $14,800 employer contribution), versus $7,500 through a Roth IRA alone. A lower-income subcontractor becomes eligible on January 1, 2027 for the federal Saver's Match, up to $1,000 paid into a non-Roth IRA even when the qualifying contribution was Roth, under MAGI phase-outs of $20,500 to $35,500 single, $30,750 to $53,250 head of household, and $41,000 to $71,000 joint; Gigaverse's Saver's Match Roth rule page explains it. The free tools compute all of it from a Schedule C estimate, including the 2026 mileage split of $0.725 per mile through June and $0.76 from July for subcontractors who drive.

Where Gigaverse fits

Gigaverse is a subscription retirement app for 1099 workers, and the business-owner program lets you make it available to subcontractors as a resource or a licensed seat without sponsoring a plan. Today the app offers a Roth IRA through a FINRA/SIPC-member broker-dealer; it opens Solo 401(k) and SEP IRA plans through its custodian partner, with applications open now, and provides the contribution math, tracking, and a year-end CPA hand-off alongside them. Gigaverse is pursuing SEC RIA registration, does not guarantee returns, and pays owners only through subscription revenue share or per-seat licences. Program details are on the business owner partner page.