S Corporation Election Calculator | Griffin Law Firm, PLLC

S Corporation Election Calculator

As a self-employed individual, you may be paying more in self-employment taxes than necessary. Electing S corporation treatment can potentially reduce your tax burden by allowing you to split your income between salary and distributions.

This calculator helps you determine whether an S corporation election could benefit your specific situation. The primary savings come from avoiding self-employment tax on distributions, though there are additional costs to consider.

Your total business income after deducting business expenses
The IRS requires you to pay yourself a reasonable salary for the work you perform. This typically ranges from 40-60% of net income depending on your industry and role.
Payroll processing, additional accounting fees, and state franchise taxes (typically $2,000-$5,000 annually)

Your Results: Side-by-Side Comparison

Current Structure
(Sole Proprietor/LLC)

Net Business Income
$0
Self-Employment Tax (15.3%)
$0
Additional Administrative Costs
$0
TOTAL TAX & COSTS
$0

S Corporation
Structure

Reasonable Salary
$0
Distributions (Tax-Free from FICA)
$0
Total Payroll Tax on Salary (15.3%)
$0
Additional Administrative Costs
$0
TOTAL TAX & COSTS
$0
YOUR ANNUAL SAVINGS WITH S CORP
$0

Important Considerations

    Disclaimer: This calculator provides estimates for educational purposes only and should not be considered legal or tax advice. Every business situation is unique, and the actual tax implications of an S corporation election depend on numerous factors including state laws, business structure, and individual circumstances. Please consult with a qualified tax professional or attorney before making any decisions regarding your business structure.