Would an S-corp save you money?

Compare self-employment tax with paying yourself through payroll, using 2026 rates. Takes 30 seconds; no sign-up.

Common questions

What is a reasonable salary?

The IRS expects S-corp owners who work in the business to pay themselves what the business would pay someone else for the same work. There is no fixed percentage: we set it with you based on your role, hours and local pay data, and document why.

When is an S-corp worth it?

Usually once profit is steady and high enough that the payroll-tax saving clearly beats the extra costs: payroll, a separate 1120-S return and state filings. This check shows the payroll-tax side; we look at the whole picture on a free call.

I'm already an S-corp and pay myself nothing. Is that a problem?

It's a common audit flag. Distributions with no salary invite the IRS to reclassify them as wages, with back payroll taxes, penalties and interest. We can set up payroll and fix it going forward.

How does Lyco run payroll?

On Gusto. We set up the company, run each payroll and keep it in sync with your books; Gusto files the payroll tax forms.

Estimate for one owner at 2026 federal rates: Social Security 12.4% up to $184,500, Medicare 2.9%, FUTA $42, Florida reemployment tax $189 (new-employer rate) and Gusto's list price of $55 a month. It leaves out income tax, the QBI deduction, the deductible half of self-employment tax, the 0.9% Additional Medicare Tax and the cost of a separate 1120-S return. Not tax advice.

Lyco Inc provides bookkeeping, payroll, tax preparation and advisory services. Lyco Inc is not a CPA firm and does not perform audit or attest services.