S-Corp Tax Savings Calculator
If you're self-employed and earning $60K+ in profit, S-Corp election could save you thousands in self-employment tax each year. See your potential savings below.
Calculate Your S-Corp Savings
Revenue minus business expenses (Schedule C line 31)
Suggested: $0 (what someone in your role would earn)
How S-Corp Saves You Money
As a sole proprietor or single-member LLC, you pay 15.3% self-employment tax (Social Security + Medicare) on ALL your business profit.
As an S-Corp, you split your profit into two parts:
- • Reasonable salary — subject to payroll taxes (15.3%)
- • Distribution (profit above salary) — NOT subject to self-employment tax
The savings come from the portion above your salary that avoids the 15.3% SE tax.
Example: $120K net profit
Without S-Corp: Pay 15.3% on ~$120K = ~$17K in SE tax
With S-Corp ($60K salary): Pay 15.3% on $60K = ~$9.2K. Save ~$7,800/year.
When Does S-Corp Make Sense?
- ✅ Net profit consistently above $60K/year
- ✅ You plan to stay self-employed for multiple years
- ✅ You're comfortable with running payroll (can use a service for $30-50/month)
- ✅ Your business doesn't have significant losses to pass through
- ❌ Net profit below $40-50K (savings don't justify the compliance costs)
- ❌ You're just starting out and income is unpredictable
- ❌ You plan to sell the business soon (S-Corp has less favorable sale treatment)
S-Corp Annual Costs
| Payroll service | $30-50/month ($360-600/year) |
| S-Corp tax return (Form 1120S) | $500-1,500 (CPA filing) |
| Registered agent (if required) | $50-300/year |
| State franchise/annual fees | $0-800/year (varies by state) |
| Total overhead | ~$1,000-2,500/year |
S-Corp makes sense when tax savings exceed these overhead costs — typically around $60K+ in net profit.
Ready to make the switch?
We handle the S-Corp election (Form 2553), set up payroll, determine your reasonable salary, and file your annual 1120S return. CPA-reviewed.
Coming Soon — $800-1,500/year