LLC Tax Calculator 2026
Estimate your self-employment tax, QBI deduction, and federal + state tax — and see whether an S-Corp election saves you money — in 60 seconds.
Educational estimate only — not tax advice. Uses 2026 federal brackets, a $184,500 Social Security wage base, and California state figures. QBI uses 197,300 threshold figures and does not model the UBIA/property limit, state SE-tax add-backs, or guaranteed payments. Confirm with a CPA before filing.
Worked example: a single-member LLC earning $120,000 in California
Take a freelance designer running a single-member LLC with $120,000 of net profit, filing single in California. As a sole proprietor, self-employment tax runs about $16,955 (15.3% on 92.35% of profit, since profit is under the $184,500 Social Security wage base). The QBI deduction shaves roughly $19,084 off taxable income, leaving about $11,506 in federal income tax and roughly $6,541 in California tax — a total near $35,002, an effective rate of about 29.2%.
Now elect S-Corp status and pay a $60,000 reasonable salary. Payroll tax applies only to the salary, so the self-employment/payroll bill drops to about $9,180 — an SE-tax saving of roughly $7,775. Federal income tax actually rises (a smaller distribution means a smaller QBI deduction), so total tax lands near $30,204 — about $4,800 less than sole-prop. After ~$2,500 of payroll and bookkeeping costs, the real net saving is closer to $2,300. Use the calculator above to test your own salary and profit.
How LLCs are taxed
An LLC is a legal structure, not a tax classification. By default the IRS taxes it as a pass-through: the LLC pays no federal income tax of its own, and profit “passes through” to the owners, who report it on their personal returns. This avoids the double taxation that hits C-Corporations.
Through the “check-the-box” rules, an LLC can choose how it is taxed. A single-member LLC is a disregarded entity (taxed like a sole proprietor on Schedule C) but can elect to be taxed as an S-Corp or C-Corp. A multi-member LLC is taxed as a partnership (Form 1065, K-1s to each owner) by default, and can also elect S-Corp or C-Corp treatment. The election changes the tax math — not your legal liability protection.
Single-member vs multi-member LLCs
A single-member LLCreports business income on Schedule C of the owner's 1040 and pays self-employment tax on the full profit via Schedule SE. A multi-member LLC files an informational partnership return (Form 1065) and issues each member a K-1 reporting their share of profit; each member then pays income and self-employment tax on their share. In this calculator, enter your shareof the profit for a multi-member LLC. Guaranteed payments to partners are taxed slightly differently and aren't modeled here.
When an S-Corp election saves money — and what it really costs
The S-Corp pitch is simple: split your profit into a reasonable W-2 salary (subject to payroll tax) and distributions (not subject to self-employment tax). The lower your salary, the less payroll tax — but the IRS requires that salary to be reasonable for the work you do, and lowballing it is a well-known audit trigger.
The savings are real but bounded by costs. An S-Corp adds a payroll service, bookkeeping, and a separate 1120-S tax return — commonly $2,000–$3,000 per year. As a rough rule of thumb, the election starts to pay off once net profit is around $80,000+, where the SE-tax saving comfortably clears those costs. The comparison card above shows the SE-tax saving and the net benefit after a typical $2,500 of admin cost so you can judge your own break-even.
The QBI (Section 199A) deduction, explained
The Qualified Business Income deduction lets most pass-through owners deduct up to 20% of their qualified business income, on top of the standard deduction. Below the 2026 taxable-income thresholds (about $197,300 single / $394,600 married), almost every business qualifies for the full 20%. Above the thresholds, two limits kick in: specified service businesses (law, health, accounting, consulting, financial services) phase out entirely, while other businesses are capped at 50% of W-2 wages paid. That wage limit is one reason high-earning owners elect S-Corp status — paying yourself a salary creates W-2 wages that can preserve part of the QBI deduction.
LLC tax FAQs
How much tax does an LLC pay?
An LLC itself usually pays no separate federal income tax — by default it is a pass-through entity, so profit flows to the owners' personal returns. A single-member LLC owner pays self-employment tax (15.3% up to the Social Security wage base, then 2.9%+ Medicare) plus federal and state income tax on the profit. On $120,000 of net profit, a single filer in a mid-tax state typically pays roughly $17,000 in self-employment tax and $11,000–$12,000 in federal income tax after the QBI deduction, before state tax.
Is this LLC tax calculator accurate for 2026?
It uses 2026 federal brackets and the standard deduction, the self-employment tax rules (92.35% net earnings, 15.3% up to the Social Security wage base, plus Medicare and the 0.9% additional Medicare surtax), the Section 199A QBI deduction, and state income tax pulled from each state's 2026 data. It is an educational estimate — it doesn't model every credit, the UBIA property limit, or guaranteed payments — so confirm with a CPA before filing.
LLC vs S-Corp taxes in 2026 — which saves money?
An S-Corp election lets you split profit into a reasonable W-2 salary (subject to payroll tax) and distributions (not subject to self-employment tax), which can cut your SE-tax bill. The savings only matter once profit is high enough — usually around $80,000+ — because an S-Corp adds real costs: payroll processing, bookkeeping, and a separate 1120-S return, often $2,000–$3,000 a year. The calculator shows both side by side so you can see the net benefit after those costs.
What is the QBI deduction and does my LLC qualify?
The Qualified Business Income (Section 199A) deduction lets most pass-through owners deduct up to 20% of qualified business income. Below the 2026 taxable-income thresholds (about $197,300 single / $394,600 married), nearly all businesses qualify. Above them, specified service businesses (SSTBs) — law, health, accounting, consulting, finance — phase out, and other businesses become limited by W-2 wages paid. Toggle the SSTB box in the calculator to see the effect.
Does a single-member LLC file a separate tax return?
No. A single-member LLC is a 'disregarded entity' by default — you report its income and expenses on Schedule C of your personal Form 1040, and pay self-employment tax via Schedule SE. A multi-member LLC files a partnership return (Form 1065) and issues each owner a K-1. Electing S-Corp status changes this: the LLC files Form 1120-S and you take a W-2 salary.
Do LLC owners have to pay quarterly estimated taxes?
Usually yes. Because no employer withholds tax from LLC profit, owners generally make quarterly estimated payments (Form 1040-ES) to cover income and self-employment tax. The 2026 due dates are April 15, June 15, September 15, and January 15, 2027. To avoid a penalty, pay at least 90% of this year's tax or 100% of last year's (110% if prior-year AGI exceeded $150,000).