LLC vs S Corporation Tax-Savings Calculator
Compare estimated federal employment taxes for a sole-proprietor LLC with an S corporation paying a reasonable owner salary. Include extra payroll, tax preparation, administration and state entity fees before judging potential savings. The result shows a fixed-salary break-even scenario and separates an optional retirement-deduction effect from the payroll-tax comparison.
Your scenario
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Your estimate
Complete the scenario to see a result, its breakdown and limitations.
Next steps
Check the assumptions with your records before making a decision. Related calculators can help compare the next part of your plan.
How the estimate works
For the LLC, apply Social Security and Medicare to 92.35% of net profit with wage-base and Additional Medicare adjustments. For the S corporation, calculate employer and employee payroll tax on salary. Subtract extra administration costs and show any entered retirement-deduction difference separately.
Worked example
At $100,000 profit with no other wages, LLC self-employment tax is $14,129.55. A $60,000 owner salary produces $9,180 combined payroll tax; $3,000 extra administration leaves $1,949.55 before income-tax interactions.
Sources and review scope
Source comparison: 2026-09-23. Methodology owner: Toolistify. Implementation reviewed through automated source checks and regression tests; this is not professional tax, legal, benefits or financial certification.
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Questions and answers
Does an S corporation always save money?
No. Salary, payroll taxes, extra costs, state rules and income-tax effects can remove any savings. A positive estimate is not an election recommendation.
Can I select any owner salary?
No. Salary must be reasonable for the services performed. The calculator cannot establish reasonable compensation.