LLC vs S-Corp Tax Comparison Calculator

Compare tax liability as an LLC vs S-Corp. See how much you can save on self-employment tax with an S-Corp election.

By Konstantin Iakovlev · Updated April 2026 · Source: IRS — Small Business & Self-Employed

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LLC Total Tax

$25,745.30

S-Corp Total Tax

$21,340.20

Annual S-Corp Savings

$4,405.10

Side-by-Side Comparison

Gross Business Income$100,000.00
LLC | S-Corp
SE Tax / FICA$14,129.55 | $9,180.00
Federal Income Tax$11,615.75 | $12,160.20
State Income Tax$0.00 | $0.00
Total Tax$25,745.30 | $21,340.20
Net Take-Home$74,254.70 | $78,659.80

S-Corp Breakdown

Reasonable Salary$60,000.00
Distributions$40,000.00
FICA on Salary (employer + employee)$9,180.00

Electing S-Corp status could save you approximately $4,405.10/year in self-employment taxes. This assumes IRS accepts your reasonable salary of $60,000.00. Consult a CPA for your specific situation.

Use the LLC vs S-Corp Tax Comparison Calculator above to calculate your results. Enter your values and see instant results — all calculations run in your browser.

Disclaimer: This calculator is for informational purposes only and does not constitute tax, financial, or legal advice. Results are estimates based on the information you provide and current rates. Always consult a qualified tax professional or financial advisor for advice specific to your situation.

How It Works

Choosing between an LLC and an S-Corporation comes down to which structure leaves more money in your pocket after taxes, and this tool runs both scenarios side by side to show the difference. The stakes are sharpest in 2026, when LLC profits are exposed to self-employment tax at 15.3% while an S-Corp can trim payroll tax by paying the owner a reasonable salary and treating the rest as distributions.

On the LLC side, the calculation stacks income tax on top of self-employment tax. For the S-Corp, it adds income tax, payroll taxes on the reasonable salary, and income tax on the remaining distributions, then sets the two totals against each other. Both paths run through the 2026 tax brackets and standard deductions, and the 20% Section 199A deduction is applied wherever it qualifies.

An S-Corp only works if owner-employees draw a reasonable salary, which usually lands somewhere between 40% and 60% of profits depending on the industry and how hands-on the owner is. These figures assume tax planning is handled optimally, so treat the output as a starting point: state taxes, fringe benefits, and the added administrative cost of running an S-Corp all shift the real-world answer.

Consulting Business with $120,000 Annual Profit

  1. 1 A single consultant generates $120,000 in business profit and needs to compare LLC versus S-Corp taxation, assuming a reasonable S-Corp salary of $60,000 (50% of profits).
  2. 2 LLC total tax: $120,000 profit minus $24,000 Section 199A deduction equals $96,000 taxable income, resulting in $15,389 income tax plus $16,956 self-employment tax for $32,345 total.
  3. 3 S-Corp calculation: $60,000 salary generates $4,590 payroll taxes plus $9,169 income tax, while the $60,000 distribution (after Section 199A deduction) adds $7,200 income tax.
  4. 4 S-Corp total tax of $20,959 versus LLC total of $32,345 shows potential annual savings of $11,386, though this must be weighed against S-Corp compliance costs and payroll processing requirements.

Source: IRS — Small Business & Self-Employed · Last updated: April 2026

Frequently Asked Questions

When does it make sense to elect S-Corp status?
Generally when your net business income exceeds $50,000-$60,000 per year. At that point, the self-employment tax savings from paying yourself a reasonable salary and taking the rest as distributions can outweigh the added costs of S-Corp compliance.
How much can I save on self-employment tax with an S-Corp?
As an LLC, you pay 15.3% self-employment tax on all net income. As an S-Corp, you only pay FICA taxes on your salary. On $120,000 net income with a $60,000 salary, you save roughly $9,180 in self-employment tax.
What are the downsides of S-Corp election?
Added complexity includes mandatory payroll processing, quarterly payroll tax filings, a reasonable salary requirement, and typically higher accounting costs ($1,000-$3,000+ per year). It may not be worth it for lower-income businesses.

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