S Corp vs LLC
Business — Honest comparison to help you decide
S Corporation
- ✓ Save on self-employment tax
- ✓ Salary + distribution split
- ✓ More credibility with some clients
- ✓ Easier to raise investment
- ✓ Well-established legal structure
VS
LLC
- ✓ Simpler to set up and maintain
- ✓ Fewer compliance requirements
- ✓ Flexible profit distribution
- ✓ Pass-through taxation
- ✓ No payroll required
The Verdict
Under $50K profit: LLC (simpler). $50K-$200K: S Corp saves $2,000-15,000/year in SE tax. Over $200K: consult a CPA — the answer depends on your specific situation.