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Rubric Financial

Free Decision Tool

LLC or S-Corp?

Five questions. CPA-grade verdict. Based on the actual variables that drive the decision, profit, reasonable comp, state tax, complexity tolerance, QBI interaction.

Pick the option that best fits your situation for each question. Your verdict appears after all five are answered.

  1. 1. What's your projected net business profit this year?

  2. 2. Can you defensibly pay yourself a reasonable salary above ~$60K for the work you do?

    Based on BLS data, industry comparables, or similar roles in your market.

  3. 3. Which state are you in?

    California adds a 1.5% S-corp tax (min $800). Texas, Florida, Washington, no extra cost.

  4. 4. How do you feel about running payroll + filing a separate 1120-S each year?

  5. 5. Do you currently benefit from the QBI deduction as an LLC?

    20% deduction on pass-through business income, affects the S-corp math.

Answer all questions to see your result.

Email me what to do with this number.

Next: what the S-corp election commits you to, the yearly cost of running it, and when to revisit the decision. We send short, partner-written reads on tax, accounting, and finance, and nothing else. The calculator itself stays free and needs no sign-up. No spam, unsubscribe anytime.

Run the actual numbers

The quiz gives you the direction. The S-Corp Savings Calculator gives you the dollars, federal payroll tax savings net of overhead and California-specific costs.

See S-Corp Savings Calculator

Frequently Asked

LLC vs. S-corp questions

Is the verdict definitive?
No, it's a directional indicator. The actual S-corp decision depends on specifics this quiz can't capture: prior-year basis tracking, owner health insurance setup, retirement plan contribution strategy, QBI interaction details, and state-specific rules beyond California's 1.5% tax.
What's the typical S-corp savings amount?
Net of payroll provider cost, additional tax prep, and any state S-corp tax, savings typically run $3K–$15K per year for owners with profit between $100K and $300K. Higher profit, lower-tax states, and stable income increase the savings.
Can I undo the S-corp election if it doesn't work out?
Yes, but you must wait 5 years after revocation before re-electing. Don't elect casually. Use this quiz as a starting point and run a full analysis before filing Form 2553.

Keep reading

Glossary

Schedule K-1

IRS form reporting a partner's, S-corp shareholder's, or trust beneficiary's share of income, deductions, and credits.

Glossary

Passthrough Entity

A business entity that doesn't pay federal income tax; income passes through to the owners.

Glossary

S-Corporation (S-corp)

A passthrough entity that allows owner-employees to split income between salary (subject to FICA) and distribution (not).

Glossary

Limited Liability Company (LLC)

A flexible legal entity that combines personal liability protection with passthrough taxation by default.

Guide

S-corp vs. LLC for Small Business Owners

When the S-corp election actually saves money for an LLC owner, and when it costs more in headaches than it pays in taxes.

Guide

K-1 Income: What It Is and How to File It

If you're a partner, S-corp shareholder, or LLC member, you'll get a K-1. Here's how to read it and where each number lands on your 1040.

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