Calculate Your Savings
Enter your business details to compare LLC vs S-Corp taxes.
Revenue minus expenses before owner pay.
Must be reasonable for your role. Generally 40-60% of net income.
Some states have additional S-Corp fees.
Tax Comparison
Enter your income details and click "Compare LLC vs S-Corp" to see your potential savings.
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LLC vs S-Corp: Key Differences
| Feature | LLC | S-Corp |
|---|---|---|
| Self-Employment Tax | On all net income | Only on salary |
| Payroll Required | ✗ Not required | ✓ Required for owners |
| Complexity | Simple | More complex |
| Annual Costs | $0 - $500 | $1,500 - $3,000+ |
| Best For Income | Under $50,000 | Over $50,000 |
| Ownership Flexibility | Unlimited members, any type | Max 100 shareholders, individuals only |
| Pass-Through Taxation | ✓ | ✓ |
| QBI Deduction Eligible | ✓ | ✓ |
Frequently Asked Questions
When does S-Corp make sense?
Generally when net income exceeds $50,000-$60,000 annually. Below that, the additional costs and complexity often outweigh the tax savings.
What is a "reasonable salary"?
The IRS requires S-Corp owners to pay themselves a salary comparable to what they'd earn doing similar work elsewhere. Too low risks IRS scrutiny.
Can I switch from LLC to S-Corp?
Yes. An LLC can elect S-Corp tax treatment by filing Form 2553. You keep your LLC but get taxed as an S-Corp. This is very common.
What are the additional S-Corp costs?
Payroll processing ($500-1,500/year), additional tax return ($500-1,000), and potentially state fees. Budget $1,500-3,000 annually.
Not Sure Which Structure Is Right?
Our CPAs can analyze your specific situation and recommend the best approach.
Disclaimer
This calculator provides estimates for educational purposes only. Actual tax savings depend on many factors including state taxes, other income, deductions, and IRS requirements for reasonable compensation. Consult with a qualified CPA before making business structure decisions.