LLC vs S corp in Connecticut: which costs less (2026)

At $100,000 profit in Connecticut, a single-member LLC costs $25,952 a year in tax and fees and an LLC taxed as an S corp costs $21,746. An LLC taxed as an S corp starts to cost less from about $52,500 of profit.

$4,206 a year

saved by switching from a single-member LLC to an LLC taxed as an S corp in Connecticut, at these numbers.

Switching from a single-member LLC to an LLC taxed as an S corp starts to pay at about $52,500 of profit, with the same settings. As an LLC taxed as an S corp this uses the state's pass-through entity tax election, which lowers the cost here.

Connecticut, 2026: $100,000 profit, single filer

Item	LLC	LLC as S corp	Change
Annual Reportbusiness.ct.gov, checked Oct 20, 2026	$80	$80	$0
Self-employment taxirs.gov, 2026 rates	$14,118	$0	−$14,118
Federal income taxirs.gov, 2026 rates	$8,222	$8,892	+$670
State income tax, after the PTET creditportal.ct.gov, checked Oct 20, 2026	$3,532	$289	−$3,243
Payroll tax on your salaryirs.gov, 2026 rates	$0	$6,675	+$6,675
State disability and paid leavectpaidleave.org, checked Oct 20, 2026	$0	$200	+$200
Payroll service and tax return (estimate)	$0	$1,800	+$1,800
Connecticut pass-through entity tax, paid by the company (elected)portal.ct.gov, checked Oct 20, 2026	$0	$3,810	+$3,810
Yearly cost	$25,952	$21,746	−$4,206

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.

Yearly cost at each profit level

Profit	LLC	LLC as S corp	Difference
$30,000	$5,571	$7,338	+$1,767
$50,000	$10,956	$11,173	+$217
$75,000	$17,811	$14,751	−$3,060
$100,000	$25,952	$21,746	−$4,206
$150,000	$43,873	$37,022	−$6,851
$200,000	$62,491	$53,221	−$9,270
$300,000	$107,497	$88,277	−$19,220

Federal and Connecticut tax and fees, single filer, revenue 1.5 times profit, default salary for S and C corps. "Difference" is LLC taxed as an S corp minus Single-member LLC.

What the switch takes in Connecticut

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
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.
Register with Connecticut 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 Connecticut unemployment tax at 1.9% on the first $27,000 of wages. portal.ct.gov See what payroll costs.
Federal return each year: Form 1120-S, due March 15, plus your own Form 1040.
State upkeep each year: Annual Report, $80 a year, due Between January 1 and March 31 each year.

What changes between the two

A plain LLC pays self-employment tax of 15.3% on 92.35% of all profit, up to the Social Security wage base of $184,500. Taxed as an S corp, the business pays you a salary, and only the salary carries Social Security and Medicare tax. The rest comes out as a distribution.

The election adds costs: a payroll service, a separate business tax return (Form 1120-S), federal and Connecticut unemployment tax on the salary. The calculator counts $1,800 a year for payroll and the return. The IRS expects a reasonable salary for the work, so it cannot be set near zero.

Questions

At what profit does an S corp election pay in Connecticut?

About $52,500 a year, on the default salary (40% of profit, at least $30,000 where profit allows) and $1,800 of yearly payroll and return costs. Change the salary in the calculator to see how the point moves.

How much does it save at $100,000 in Connecticut?

$4,206 a year: Single-member LLC $25,952, LLC taxed as an S corp $21,746.

Does Connecticut recognise the S corp election?

Yes. No separate state form is needed.

More for Connecticut

Common cases in Connecticut

Other states