StructureCost2026

LLC or S corp for a dentist in California (2026)

A dentist in California with $190,000 of profit pays $62,586 a year in tax and fees as a sole proprietor and $65,641 as an LLC taxed as an S corp, with a $133,000 salary. On these figures the S corp does not pay at any profit up to $500,000.

More settings revenue, salary, filing status, payroll costs, PTET

+$3,055 a year

more for an LLC taxed as an S corp than a sole proprietorship in California, at these numbers.

With these settings the switch does not pay at any profit from $10,000 to $500,000. Setting up costs $70 once in state filing fees. As an LLC taxed as an S corp this uses the state's pass-through entity tax election, which lowers the cost here.

California, 2026: $190,000 profit, single filer

ItemSole propLLC as S corpChange
Self-employment taxirs.gov, 2026 rates$26,846$0−$26,846
Federal income taxirs.gov, 2026 rates$23,410$28,304+$4,894
State income tax, after the PTET creditftb.ca.gov, checked Oct 23, 2026$12,330$8,277−$4,053
Statement of Information (Form LLC-12)sos.ca.gov, checked Oct 23, 2026$0$10+$10
Payroll tax on your salaryirs.gov, 2026 rates$0$20,636+$20,636
State disability and paid leaveedd.ca.gov, checked Oct 23, 2026$0$1,729+$1,729
Payroll service and tax return (estimate)$0$1,800+$1,800
California S corporation tax (1.5%)ftb.ca.gov, checked Oct 23, 2026$0$800+$800
California pass-through entity tax, paid by the company (elected)ftb.ca.gov, checked Oct 23, 2026$0$4,085+$4,085
Yearly cost$62,586$65,641+$3,055
What these figures count
  • State income tax, and state taxes on the business itself: franchise, LLC, S corp, gross receipts and excise taxes.
  • Social Security and Medicare on both sides of an owner salary, federal unemployment tax and the state's new-employer rate.
  • The 20% qualified business income deduction with its income limits and the professional-service rule.
  • Yearly report fees, and a cost you can change for payroll and the business tax return.

Many S corp calculators leave out state taxes and the QBI deduction, which can make the election look better than it is.

At three profit levels

ProfitSalary usedSole propLLCLLC as S corpC corp
$130,000$91,000$38,654$39,695$40,926$46,500
$190,000$133,000$62,586$64,551$65,641$73,567
$270,000$171,000$96,955$98,233$98,215$111,182

Salary is the BLS median for the job ($170,950), capped at 70% of profit. Revenue 3.5 times profit. Single filer.

What matters for dentists

What the switch takes in California

  1. File the Articles of Organization (Form LLC-1) with the state: $70 (fee).
  2. Get an EIN from the IRS (free, online) and open a business bank account in the new name.
  3. Check the business can elect: no more than 100 shareholders, all of them US citizens or residents (no nonresident alien owners), and one class of stock. IRS
  4. File IRS Form 2553 to elect S corp tax treatment, within 2 months and 15 days of the start of the tax year it should apply to. See how the S corp election works.
  5. Register with California as an employer and run payroll for your own salary: federal Forms 941 each quarter, Form 940 and a W-2 each year. New employers pay California unemployment tax at 3.4% on the first $7,000 of wages. edd.ca.gov See what payroll costs.
  6. Federal return each year: Form 1120-S, due March 15, plus your own Form 1040.
  7. State upkeep each year: Statement of Information (Form LLC-12), $20 every two years, due within 90 days of formation, then every two years by the end of the registration month. New for you: California S corporation tax (1.5%).

Questions

Should a dentist in California form an S corp?

At $190,000 of profit, not on these figures: the S corp costs $3,055 a year more than staying a sole proprietor.

Is an LLC worth it for a dentist in California?

For tax, a single-member LLC changes nothing: $64,551 a year against $62,586, the difference being California's LLC fees and LLC taxes. It separates business liability and is the base for an S corp election.

More

Other professions in California
Other states