S-Corp vs. LLC — When the Tax Savings Actually Show Up
S-corp election starts paying for itself around $40-60K of net profit. Below that, the payroll overhead eats the savings.
Single-member LLCs default to Schedule C and pay self-employment tax on all profit. An S-corp election lets you split profit into salary (SE tax) and distributions (no SE tax) — but only if the salary is 'reasonable' for IRS purposes.
Frequently Asked Questions
More in IRS & Financial
What Is an IRS Installment Agreement?
An IRS Installment Agreement lets you pay back taxes in monthly payments. Here are the types, eligibility rules, fees, and how to apply.
How Does an Offer in Compromise Work?
An Offer in Compromise lets you settle IRS tax debt for less than you owe — but only if you genuinely cannot pay in full. Here is how the IRS evaluates an offer.
How to Stop an IRS Wage Garnishment
An IRS wage garnishment can take up to 85% of your paycheck. Here's how to get it released — sometimes within days.
Ready to get started?
Talk with our team — we'll prepare every form, file with the right agency, and walk you through the process.