Free tool
S corp tax savings calculator
Estimate how much an S corp election could save on Social Security and Medicare taxes, using 2026 rates from the IRS and the Social Security Administration.
Profit after business expenses, before paying yourself.
Must be reasonable pay for the work you do.
Your estimate: payroll service, the separate S corp tax return, any state fees.
| Tax | LLC (default) | LLC as S corp |
|---|---|---|
| Social Security (12.4%) | ||
| Medicare (2.9%) | ||
| Extra S corp costs | $0 | |
| Total |
How this works: as a default LLC, self-employment tax applies to 92.35% of your profit, at 12.4% for Social Security (up to the 2026 wage base of $184,500) plus 2.9% for Medicare (IRS, Schedule SE, SSA). As an S corp, the same 15.3% applies only to your salary (the employee and employer shares combined); the rest of the profit comes out as distributions without those taxes. Not included: income tax effects (deductions for half of SE tax or the employer's payroll tax, the qualified business income deduction), the 0.9% Additional Medicare Tax on high earners, and state taxes. This is an estimate, not tax advice.
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Disclaimer: The information in this article is for educational purposes only and does not constitute legal, tax, or financial advice. Business formation rules, fees, and deadlines vary by state and change often. Always consult a qualified attorney, CPA, or tax professional before making decisions about your business.