Tax Calculator
S-Corp Tax Calculator
Estimate the payroll tax effect of pairing a reasonable W-2 salary with S corporation pass-through income, using current 2026 Social Security and Medicare tax inputs.
Enter estimated business profit before owner compensation, a reasonable salary estimate, any other W-2 wages already subject to Social Security tax, and any optional outside administrative cost assumption you want included in the comparison.
What To Review Before Electing S-Corp Status
A tax-savings estimate is only one part of the decision. The structure should also work operationally and survive IRS review.
Reasonable salary support
Document duties, time, expertise, market pay, profit, cash flow, and how the salary was chosen.
Payroll and benefits
Confirm payroll deposits, W-2 reporting, retirement deferrals, health insurance, and accountable plan treatment.
Basis and distributions
Track shareholder stock basis, debt basis, draws, loan repayments, and distributions before filing.
State and compliance effects
Review state S corporation recognition, franchise taxes, annual reports, payroll accounts, and filing costs.
When the Estimate Can Mislead
The result can look attractive when profit is high and salary is low, but a salary that is not reasonable can create payroll tax exposure, penalties, amended returns, and retirement-plan problems. The calculator should start the conversation, not end it.