By default, a single-member LLC is a “disregarded entity” and a multi-member LLC is a partnership — either way,
100% of your net profit flows through to your personal tax return and gets hit with 15.3% self-employment tax on every dollar.
With an S-Corp election, your LLC is still a pass-through entity (profits still flow to your personal return), but you pay yourself a
reasonable W-2 salary first. Only that salary is subject to self-employment/payroll taxes. Everything above the salary is distributed to you as profit distributions —
NOT subject to the 15.3% SE tax. That’s where the savings come from.
The catch: The IRS requires Form 2553 to be filed within
75 days of your LLC’s formation (or by March 15 for existing LLCs). Miss it — you wait until next tax year. We prepare and file Form 2553 on your behalf, correctly and on time.
Fee breakdown
- $149 — our full S-Corp election service (Form 2553 preparation + filing)
- $0 — the IRS doesn’t charge for S-Corp election
⚠ Not tax advice: S-Corp is a federal tax election with real trade-offs — payroll filings, reasonable compensation rules, and added compliance. We recommend talking with a CPA to confirm it’s right for your income level and situation before electing.