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

At $100,000 profit in Delaware, a single-member LLC costs $27,568 a year in tax and fees and an LLC taxed as an S corp costs $23,179. An LLC taxed as an S corp starts to cost less from about $50,000 of profit.

$4,389 a year

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

Switching from a single-member LLC to an LLC taxed as an S corp starts to pay at about $50,000 of profit, with the same settings.

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

Item	LLC	LLC as S corp	Change
Delaware annual LLC taxcorp.delaware.gov, checked Oct 23, 2026	$400	$400	$0
Delaware business licenserevenuefiles.delaware.gov, checked Oct 23, 2026	$75	$75	$0
Self-employment taxirs.gov, 2026 rates	$14,062	$0	−$14,062
Federal income taxirs.gov, 2026 rates	$8,157	$9,550	+$1,393
State income taxrevenuefiles.delaware.gov, checked Oct 23, 2026	$4,874	$5,002	+$128
Payroll tax on your salaryirs.gov, 2026 rates	$0	$6,352	+$6,352
Payroll service and tax return (estimate)	$0	$1,800	+$1,800
Yearly cost	$27,568	$23,179	−$4,389

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	$6,513	$7,968	+$1,455
$50,000	$12,086	$11,918	−$168
$75,000	$19,200	$15,778	−$3,422
$100,000	$27,568	$23,179	−$4,389
$150,000	$45,878	$38,939	−$6,939
$200,000	$64,783	$55,465	−$9,318
$300,000	$108,944	$90,914	−$18,030

Federal and Delaware 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 Delaware

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 Delaware 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 Delaware unemployment tax at 1% on the first $14,500 of wages. labor.delaware.gov See what payroll costs.
Federal return each year: Form 1120-S, due March 15, plus your own Form 1040.
State upkeep each year: no yearly report fee, due Annual LLC tax due June 1 for the prior 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 Delaware 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 Delaware?

About $50,000 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 Delaware?

$4,389 a year: Single-member LLC $27,568, LLC taxed as an S corp $23,179.

Does Delaware recognise the S corp election?

Yes. No separate state form is needed.

More for Delaware

Common cases in Delaware

Other states