A “Solo-k” is a 401k retirement plan for a business with no employees except the owner andthe owner’s spouse, if s/he is also an employee. The rules are the same as for a traditional 401k except that no annual reporting is required with the IRS until the balance of the Solo-k plan (not account) reaches $250k. When the plan balance reaches/exceeds this limit, the employer must file an annual 5500-EZ, which is much simpler than the long-form 5500 required for a traditional 401k.
Moonlighting income reported on a 1099 is often used to set up a Solo-k. If you own less than 80% of your main employer, you can open the Solo-k as a second retirement account and contribute up to $61,000 ($67,500 if age 50+) in 2022. You may not be allowed to open a separate retirement account for yourself if you are a partner/shareholder in another business, such as a medical practice.
You must set up your plan by December 31 if you will be making an employee deferral contribution ($20,500 in 2022). You have until the due date of filing your tax return, including extensions, to set up and contribute to your plan if you are making profit-sharing contributions only.