S-Corp Guide
An S-corp can lower your self-employment tax, but it isn't free. You'll run payroll, pay yourself a reasonable salary, and file a separate business return. It pays off once your profit is high enough that the tax savings beat those costs.
Is an S-Corp Right for Your Business?
Ask yourself three questions
QUESTION 1
Do you run a profitable business as a sole proprietor or LLC?
QUESTION 2
Is your net profit around $30,000 a year or more?
QUESTION 3
Can you pay yourself a reasonable salary through payroll and still have profit left in the business?
YES TO ALL THREE
Worth a closer look
If you answered yes to all three, an S-corp is likely worth a closer look.
NOT SURE OR NOT YET
Still worth asking
Even if you didn't, other tax-saving strategies an S-corp makes possible can tip the math in its favor, so it's still worth asking.
Book a free call and we'll run your actual numbers, including state taxes and how the change affects your other deductions, before you elect.
Timing: To be taxed as an S-corp for a calendar year, the election (Form 2553) is generally due by March 15 of that year.
Already an S-corp? If your profit has dropped, or you're not sure your salary is right, we'll check both on the same call.
This is general information, not tax advice for your situation.