When does an S-Corp make sense?
Short Answer: An S-Corp can make sense when your business has consistent profit high enough to justify payroll and added compliance.
S-Corps can reduce self-employment tax by splitting income into salary + distributions, but they require payroll, tax filings, and ongoing compliance.
Common mistakes:
• Electing S-Corp too early
• Not running payroll correctly
• Assuming S-Corp always saves money
What we recommend: Run the numbers first, don’t elect S-Corp based on hype.
Still have questions?
If you’re not sure what applies to your situation, we can help.