S corp tax calculator for the self-employed (2026 break-even)

What the two columns do

The left column is the business as it is: a sole proprietor or single-member LLC filing Schedule C. Profit times 92.35% goes through Schedule SE at 12.4% for Social Security up to the $184,500 wage base and 2.9% for Medicare, with 0.9% more above the Additional Medicare Tax threshold. Half of the self-employment tax comes off before the 2026 standard deduction ($16,100 single, $32,200 joint), the qualified business income deduction is 20% of profit minus that half, and income tax comes from the 2026 rate schedules.

The right column is the same business taxed as an S corporation. Your salary is a W-2 wage, so it carries 7.65% each of employee and employer Social Security and Medicare (6.2% stops at the wage base; 1.45% does not). The company deducts the employer half, the $42 of federal unemployment tax, and the running costs you entered, and what is left passes through to you. Income tax is computed on wage plus pass-through profit. The IRS's own FAQs say reasonable compensation from an S corporation is not qualified business income, so the 20% deduction applies to the pass-through profit only, and the half-SE deduction no longer exists. Above the QBI threshold ($201,750 single, $403,500 joint) the deduction phases toward half of W-2 wages over the next $75,000 ($150,000 joint), which the calculator follows for both columns; the Schedule C side has no wages, so its deduction fades to zero.

If profit cannot cover the salary after running costs, the salary is capped at what is left and a note says so. The net saving is the Schedule C total minus the S corporation total: a negative number means the election costs money this year. The break-even figure scans profit upward from $20,000 in $100 steps, holding your salary rule fixed (a percentage of profit if you used a percentage button, otherwise the dollar figure you typed), and reports the first profit where the S corporation comes out ahead. The reasoning behind each rule, and a table of eight profit levels, is in the S corp break-even post.

What this leaves out

Federal tax only, apart from the California overlay, which adds the state's 1.5% S corporation tax above the $800 a non-electing California LLC already pays and treats that extra as a deductible business cost. Other states' entity taxes, franchise fees and New York City's refusal to recognize the election are not here. The calculator assumes no other household income, no retirement or health insurance deductions, no employees other than you, no depreciable property for the QBI wage-and-property test, and that your business is not a specified service trade or business, which the IRS says sponsorship and endorsement income can be. It also leaves out the time a payroll calendar takes, state registration fees, a separate accountable plan for expenses, and the reasonable-compensation risk if the salary is low. The $250 figures for state unemployment tax and software are assumptions, so replace them with your state's rate and a real quote.