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There is a high possible contribution you can make to your own 401(k), but you still have to pay attention to the limits.

As of 2016, you may contribute up to $53,000 annually to your Self-Employed 401(k), plus a $6,000 catch-up contribution if you’re over 50. If your spouse is also on the payroll, you are allowed to have a combined contribution of up to $106,000, or $118,000 if you’re both over 50.

You have to be mindful of the limits for each portion of the contribution, though. Just like a regular 401(k), the elective salary deferrals comprise $18,000 of the limit, and the catch-up contribution.

All of these contributions can be made without regard for the total salary of the person funding it (up to 100% of salary/income can be contributed to this portion of the account). Contributions to this account will limit the amount that you can deduct in IRAs outside of the 401(k).

The other part of the 401(k) is the profit-sharing component, and this is where you have to pay attention, because you can only contribute up to 25% of gross salary into a profit-sharing plan. You also must be mindful of how the self-employment tax and your actual profit-sharing contribution will reduce the income base on which you calculate the maximum 25%.

Effectively, it makes it 20% of gross income/profit. The same kind of calculations must be made for your spouse’s contributions and profit sharing contributions made to his or her account, because, unlike a Roth IRA, which can be funded for a non-working spouse, a qualified plan will require actual work and income before someone can make elective deferrals.

Obviously it is easy to get a little lost in some of this material, so we advise that you not only attempt to educate yourself, but check with a CPA or tax attorney if you are not absolutely sure.