HomeS Corp tax calculator
S Corp Tax Savings Calculator
Enter your profit and see what an S Corp election could change for the 2026 tax year. The estimate compares self employment tax on all of your profit with payroll tax on a salary, then subtracts the cost of payroll and filing.
An estimate, not a promise. The salary in the model is a screening assumption. A real election starts with a salary your facts support.
Prefer a quick read on fit first? Take the 60 second check
Live Savings Calculator
2026 Tax Law2026 planning calculation using IRS brackets, §199A QBI, FICA, Add'l Medicare & state assumptions
Use only net business profit subject to self-employment tax. Do not include capital gains, proprietary securities trading gains, investment income, or other income not subject to self-employment tax.
Your estimate should reflect your business, not a generic example.
Adjust the inputs above, then see your 2026 planning estimate. No email needed.
2026 planning projection. It assumes active participation, no non-owner W-2 wages, no qualified-property basis, and excludes FUTA and SUTA. Actual savings can differ or reverse.
How the calculator does the math
- 1
As an LLC or sole proprietor
Self employment tax applies to 92.35 percent of net profit. It is 12.4 percent for Social Security, up to the 2026 wage base of $184,500, plus 2.9 percent for Medicare with no cap. Income tax applies on top.
- 2
As an S Corp
The owner takes a salary, and Social Security and Medicare apply to that salary. The profit left after the salary passes through as distributions, which do not carry self employment tax. Income tax still applies to both.
- 3
What comes off the top
An S Corp adds payroll and its own tax return. The calculator subtracts $1,500 a year for those before it shows a difference, and it reflects the change in the qualified business income deduction, because salary reduces the income that deduction is figured on.
As an LLC today
All of the profit. Self employment tax applies to it, then income tax.
As an S Corp
Salary. Payroll tax applies.
Distributions. No self employment tax.
Three worked examples for 2026
Each example comes from the calculator above. It assumes a single filer in Texas with no other wages, an other service business, active participation, and $1,500 a year of payroll and filing cost. Change one fact and the answer changes with it.
$75,000 net profit
$3,037
estimated annual difference
Today$15,495As an S Corp$12,458$120,000 net profit
$6,963
estimated annual difference
Today$28,462As an S Corp$21,499$250,000 net profit
$11,824
estimated annual difference
Today$66,360As an S Corp$54,536
Planning projections, not a promised result. The salary in each example is a screening assumption, not a reasonable compensation analysis. See the full walkthrough of these examples
What the estimate leaves out
A calculator answers one question: is the election worth a closer look. These four facts decide whether it holds up.
Your actual reasonable salary
The model uses a screening assumption for the business type you pick. The IRS looks at your duties, time, experience, and what comparable businesses pay. A documented salary can be higher or lower, and that moves the result.
See how a salary is documentedState entity taxes and fees
The estimate applies a simplified state income tax rate. Some states also tax the S Corp itself or charge a franchise tax, and a few require their own election.
Check your stateThe filing deadline
An election generally has to be filed within two months and 15 days of the start of the tax year it applies to. A late election may still qualify for relief.
Read the deadline ruleRetirement and benefits
Salary also drives retirement plan contribution limits and Social Security earnings, so the lowest salary is not always the best one for the owner.
What to weigh before electing
Common questions
How does an S Corp tax savings calculator work?
It compares two versions of the same profit. As a sole proprietor or default LLC, self employment tax applies to 92.35 percent of net profit. As an S Corp, Social Security and Medicare apply to the owner's salary, and the remaining profit passes through as distributions. The calculator totals income tax, payroll or self employment tax, and a simplified state income tax under each version, subtracts the yearly cost of payroll and the corporate return, and shows the difference.
At what profit does an S Corp start to make sense?
There is no universal cutoff. The answer depends on the salary your facts support, your filing status, other wages, your state, and the cost of running payroll. Two owners with the same profit can get different answers, so run your own numbers instead of relying on a rule of thumb.
What salary does the calculator assume?
A screening assumption based on the business type you select. It is not a reasonable compensation analysis. The IRS expects a shareholder who works in the business to be paid reasonable compensation for the services performed, and it looks at duties, time, experience, and what comparable businesses pay. A documented salary can be higher or lower than the assumption, and that changes the estimate.
Does the estimate include state taxes?
It applies a simplified state income tax rate for the state you choose. It does not model every state entity tax, franchise tax, or fee, and a few states require their own election. Review your state's rules before relying on the figure.
Is the calculator free?
Yes. There is no charge and no account to create. To see your personalized estimate you enter an email address, and the written breakdown is sent there.
Is the result a guarantee of tax savings?
No. It is a planning projection for one tax year, built on the inputs you enter and the assumptions shown on the page. Your actual result depends on your documented salary, your complete return, and your state. If the facts do not support an S Corp election, we tell you before filing.
If the estimate looks worth it, check the fit.
The 60 second check screens eligibility, timing, and readiness. If the facts do not support an S Corp, we tell you before filing.