Uber and DoorDash Drivers Think They Have No 401(k). The IRS Lets Them Build a $72,000 One but Almost Nobody Does

You do not need six figures of profit to make this meaningful. Say a full-time driver nets $55,000 after mileage deductions. The employee bucket alone lets that driver defer most of a year’s savings capacity, and the profit-sharing side layers on roughly another 20% of net earnings. Even a part-time weekend driver netting $12,000 can route the entire amount into the employee bucket, because there is no minimum.

Context matters here. The U.S. personal savings rate sat at 3.9% in Q1 2026, down from 6.2% in Q1 2024, and personal consumption absorbed 92.3% of disposable income. Gig income is lumpy on top of that. The Solo 401(k) fits because you can fund it in bursts, not on a payroll schedule, and you have until your tax filing deadline (plus extensions for the employer portion) to make the prior-year contribution.

Roth or Traditional, Your Choice, on Both Sides

Most low-cost providers now offer a Roth Solo 401(k). As one financial commentator put it, the solo 401(k) “gives you more of the flexibility of contribution limits significantly beyond what you can do just in a Roth” IRA. Under recent rule changes, employer profit-sharing contributions can also be designated Roth. If you expect higher tax rates later, or you are in a low bracket now because of heavy mileage deductions, the Roth side is worth serious consideration.

SEP-IRA vs. Solo 401(k)

The SEP-IRA is simpler and better known, and it is what most CPAs default to for gig workers. But it only has the employer bucket, capped near 20% of net earnings. A driver clearing $40,000 can put far more into a Solo 401(k) than a SEP because the employee deferral bucket does not depend on profit. The SEP also complicates any future backdoor Roth IRA because of pro-rata rules. The Solo 401(k) avoids that trap.

Why Almost Nobody Uses It

• Awareness: platforms do not tell drivers they qualify. Compare that to W-2 workers, where Vanguard’s plan-weighted 401(k) participation rate hit 85% in 2024, largely because of auto-enrollment.

• Paperwork friction: you need an EIN and a plan document. Fidelity, Schwab (NYSE:SCHW), and E*TRADE offer no-fee Solo 401(k)s, but you have to open them yourself.

• Cash flow: average annual household expenditures reached $78,535 in 2024, and median full-time weekly earnings ran $1,235 in Q1 2026. Gig income often lands below that median, so “save it later” wins.

• Form 5500-EZ: once plan assets exceed $250,000, you owe an annual filing. Skippable at first, but real.

The Move

Get an EIN from IRS.gov (free, five minutes). Open a Solo 401(k) with a no-fee brokerage. Fund the employee bucket first because it is not profit-limited, then add profit-sharing when you file.

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