LLC vs S-Corp Tax Calculator
Compare taxes as a single-member LLC (sole proprietor) versus an S corporation in 2026 — self-employment tax vs payroll tax on a reasonable salary, plus S-corp running costs — to see if the election saves money.
Estimates only — not tax advice. Tax rules change and depend on your situation; check with the tax authority or a tax professional.
How to use
- 1Enter your business's net profit.
- 2Enter a reasonable salary you'd pay yourself as an S corp, and extra S-corp costs (payroll service, tax return).
- 3Compare the two and see the net savings.
How it's calculated
LLC: SE tax on 92.35% of profit. S corp: FICA (15.3%, Social Security portion capped) on the salary only; the remaining profit passes through without SE tax. Both pay income tax on the same total (QBI deduction ignored for simplicity). Savings = LLC SE tax − S-corp payroll tax − extra costs.
Frequently asked questions
What's a reasonable salary?
What you'd pay someone to do your job — the IRS challenges salaries that are artificially low. Many owners use 40–60% of profit as a starting point.
When does an S corp pay off?
Usually once profit comfortably exceeds about $60,000–$80,000, after covering payroll and extra accounting costs.
Any downsides?
Payroll administration, a separate business tax return (Form 1120-S), state fees in some states, and a lower salary means lower Social Security benefits later.