S-Corp Savings Calculator — Free 2026
S-Corp Savings Calculator
Calculate your exact annual self-employment tax savings from electing S-Corp status
↻ Updated 2026 — SS wage base $176,100
Enter your business details
Net business income ($)
Total net profit before owner salary or distributions.
Reasonable salary (%)
Annual admin cost ($)
Salary: · Use our Salary Calculator for your IRS-safe range.
INCOME SPLIT
Salary
Distributions
Net annual tax savings
SE tax (sole prop)
S-Corp payroll taxes
Gross tax savings
Admin costs
Your salary
Tax-free distributions
Assessment
Annual net savings
Gross savings
Tax-free distributions
10-year savings
How S-Corp Tax Savings Work
As a sole proprietor, you pay self-employment tax (15.3%) on all net business income. Electing S-Corp lets you split income into a salary (FICA applies) and distributions (no FICA). Savings come from avoiding SE tax on distributions.
SE Tax = min(Income × 0.9235, $176,100) × 12.4% + Income × 0.9235 × 2.9%
S-Corp Payroll = min(Salary, $176,100) × 12.4% + Salary × 2.9%
Net Savings = SE Tax − S-Corp Payroll − Admin Costs
S-Corp Payroll = min(Salary, $176,100) × 12.4% + Salary × 2.9%
Net Savings = SE Tax − S-Corp Payroll − Admin Costs
FAQs
Most CPAs recommend when net SE income exceeds $40,000–$50,000/yr. At $80K with 50% salary, you save ~$6,000/yr gross — a clear win.
No — S-Corp reduces SE tax (SS + Medicare) only. Both sole prop and S-Corp pass through to your personal return at the same income tax rate.