Cash Balance Plan Contribution Calculator (2026)
A cash balance plan lets an owner in their 40s, 50s or 60s deduct far more than a 401(k) allows. Enter your age, pay and staff payroll for a rough 2026 estimate before you talk to an actuary.
Estimated tax saved this year: about $102,333.
| Years of contributions to age 62 | 12 |
| Target lump sum at 62 | $3,538,000 |
| Cost after tax savings | $174,043 |
A rough estimate, not a plan design. Uses 2026 limits (IRS Notice 2025-67: $290,000 annual benefit, $360,000 pay cap), a lump-sum factor of about 12.2 at 62, a 5% interest credit, a 401(k) with deferrals, catch-up and 6% profit sharing, and staff contributions of about 7.5% of their pay. Assumes 10 or more years of service with the business. Your actuary's numbers will differ, and the contribution has to be funded every year. Educational estimate, not tax advice.
What the calculator does.
- Targets the 2026 maximum benefit ($290,000 a year, IRS Notice 2025-67) at age 62, or five years out if you're near or past 62, reduced for fewer than 10 years in the plan and capped at your pay.
- Converts that benefit to a lump sum (about 12.2 times the annual benefit) and works out the level yearly contribution to reach it with a 5% interest credit.
- Adds a 401(k) with your deferral, catch-up and 6% profit sharing, and estimates staff contributions at about 7.5% of eligible pay.
Common questions
Why does the contribution rise with age?
The plan aims at the same maximum lump sum by retirement. With fewer years to get there, each year's contribution has to be larger, so owners in their 50s and early 60s can usually contribute the most.
Do I have to include my employees?
Generally yes. Plans must pass nondiscrimination testing, so staff usually receive contributions of roughly 5% to 7.5% of pay through the plan and the 401(k). An actuary designs the plan to keep most of the contribution with the owners.
Can I skip a year?
Not freely. A cash balance plan has a required contribution each year, with some flexibility within a range. Plan on funding it for at least three to five years and only start one when income is steady.
Want a CPA to check your numbers?
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