This worksheet helps you, as an S Corporation owner, decide how much of your business income to route into retirement accounts and how that decision shapes your payroll tax burden, your income tax liability, and your year-end cash position. Every figure below is yours to adjust.
Enter your variables, slide your contribution levels, and watch the numbers respond in real time. Bring questions to our next planning meeting.
I
Step One
Tell us about you and your S Corp
years
Determines catch-up eligibility. Ages 50+ unlock $8,000 catch-up. Ages 60 to 63 unlock $11,250 super catch-up.
$
Total business profit available before paying yourself wages. This caps how much W-2 you can reasonably take.
Your top federal bracket. Each retirement dollar saves you this percentage in federal income tax.
%
Your state's top bracket. Default is Utah's 4.55% flat rate. Set to zero if you're in a no-income-tax state.
II
Step Two
Choose a starting strategy
Pick a quick-start preset, or skip ahead to dial things in manually.
Strategy A
Lean wage
$24,500
W-2 set just high enough to max the Solo 401(k) deferral. Lowest payroll tax. No SEP capacity.
Strategy B
Balanced
$58,000
Max the Solo 401(k) plus a meaningful SEP contribution. Moderate payroll tax, larger total savings.
Strategy C
Max retirement
$72,000
Wages high enough to hit the full $72,000 combined cap. Highest payroll tax, biggest income tax shelter.
III
Step Three
Fine-tune your scenario
Your contribution scenario
Drag to adjust
W-2 wages to yourself
Must be reasonable for the work you perform
$58,000
annual gross
Solo 401(k) employee deferral
Limited to W-2 amount or annual cap
$24,500
pre-tax + Roth
SEP IRA employer contribution
Limited to 25% of W-2 or remaining cap
$14,500
employer-paid
The bottom line
Total Going In
$39,000
Solo 401(k) + SEP
Total Tax Savings
$10,360
Income tax saved
Payroll Tax Cost
$8,874
15.3% of W-2
Net Cash Benefit
$1,486
Savings minus payroll tax
Income Tax Savings
Federal (22%)$8,580
State (4.55%)$1,775
Combined annual savings$10,355
Payroll Tax Detail
Social Security (12.4%)$7,192
Medicare (2.9%)$1,682
Total payroll tax$8,874
Contribution composition
How your retirement dollars are split between the two account types, with remaining capacity shown in cream.
Solo 401(k) deferral
SEP IRA contribution
Unused capacity (combined $72K cap)
How close are you to each limit?
2026 IRS ceilings, with your current scenario plotted against each one.