S-Corp Savings Calculator — 2026

Sole-prop path: Schedule SE multiplies net profit by 0.9235 (removes the employer-equivalent portion), then applies 12.4% Social Security up to the wage base and 2.9% Medicare on the full SE-taxable amount. If SE-taxable clears the 0.9% Additional Medicare threshold for your filing status ($200K single/HoH, $250K MFJ, $125K MFS), that surtax applies too.

S-Corp path: Only the W-2 salary you pay yourself is subject to payroll tax. Owner-employees effectively bear both halves (7.65% + 7.65% = 15.3%) because they own the entity. Distributions of the remaining profit escape SE and FICA entirely — that's where the savings come from.

Other W-2 wages: wages from another job use up the Social Security wage base first. On Schedule SE they shrink the income the 12.4% can reach; on the S-Corp side, the employee half of Social Security withheld above your combined wage base comes back as the excess Social Security credit, but the S-Corp's employer half does not. With wages at or near the base, the S-Corp can cost more payroll tax than it saves.

Break-even: We check every net-profit level from $0 to $2,000,000 in $100 steps (at your chosen salary-to-profit ratio), pin each crossing to the dollar, and list every range where payroll-tax savings exceed your admin cost. There can be more than one: sole-proprietor SE earnings (92.35% of profit) hit the Social Security wage base at a lower profit than your S-Corp salary does, so the saving can shrink back below the admin cost before it grows again.

What this calculator does NOT include: the reduction in your 20% QBI (§199A) deduction from paying yourself a salary, state franchise tax, retirement-plan contribution differences, or self-employed health insurance treatment. Each can move the number by hundreds to thousands of dollars — model with a CPA.