Indiana: what each business structure costs a year

At $100,000 profit, an LLC taxed as an S corp costs $4,754 a year less than a sole proprietorship in Indiana. All figures are 2026 tax and fees.

$4,754 a year

less as an LLC taxed as an S corp than as a sole proprietorship in Indiana, at these numbers. That includes the state's pass-through entity tax election.

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

Structure

Yearly cost

vs yours

To set up

Sole proprietorship yours

$25,077

Itemized: $25,077

Self-employment taxirs.gov, 2026 rates	$14,130
Federal income taxirs.gov, 2026 rates	$8,235
State income taxin.gov, checked Oct 20, 2026	$2,712
Yearly cost	$25,077

Single-member LLC

$25,087

+$10

$95

Itemized: $25,087

Business Entity Reportin.gov, checked Oct 20, 2026	$16
Self-employment taxirs.gov, 2026 rates	$14,127
Federal income taxirs.gov, 2026 rates	$8,232
State income taxin.gov, checked Oct 20, 2026	$2,712
Yearly cost	$25,087

LLC taxed as an S corp lowest

$20,323

−$4,754

$95

Itemized: $20,323

Business Entity Reportin.gov, checked Oct 20, 2026	$16
Payroll tax on your salaryirs.gov, 2026 rates	$6,400
Payroll service and tax return (estimate)	$1,800
Indiana pass-through entity tax, paid by the company (elected)secure.in.gov, checked Oct 20, 2026	$1,618
Federal income taxirs.gov, 2026 rates	$9,338
State income tax, after the PTET creditin.gov, checked Oct 20, 2026	$1,151
Yearly cost	$20,323

S corporation

$20,323

−$4,754

$95

Itemized: $20,323

Business Entity Reportin.gov, checked Oct 20, 2026	$16
Payroll tax on your salaryirs.gov, 2026 rates	$6,400
Payroll service and tax return (estimate)	$1,800
Indiana pass-through entity tax, paid by the company (elected)secure.in.gov, checked Oct 20, 2026	$1,618
Federal income taxirs.gov, 2026 rates	$9,338
State income tax, after the PTET creditin.gov, checked Oct 20, 2026	$1,151
Yearly cost	$20,323

C corporation

$29,315

+$4,238

$95

Itemized: $29,315

Business Entity Reportin.gov, checked Oct 20, 2026	$16
Payroll tax on your salaryirs.gov, 2026 rates	$6,400
Payroll service and tax return (estimate)	$2,000
State corporate income taxin.gov, checked Oct 20, 2026	$2,678
Federal corporate income tax (21%)irs.gov, 2026 rates	$10,913
Federal income taxirs.gov, 2026 rates	$4,946
State income taxin.gov, checked Oct 20, 2026	$2,362
Yearly cost	$29,315

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.

When an S corp election pays in Indiana

Electing S corp tax treatment for an LLC starts to pay in Indiana at about $50,000 of profit, with the default salary and $1,800 a year for payroll and the extra tax return.

An S corp in Indiana can elect to pay the state's income tax itself, a pass-through entity tax of 2.95%, and the owner gets a credit for it. The company deducts it on the federal return, so it is not held to the SALT cap. The calculator uses it when it lowers the totalsecure.in.gov.

Profit	Sole prop	LLC	LLC as S corp	C corp
$30,000	$5,974	$5,987	$7,459	$7,943
$50,000	$11,073	$11,086	$10,876	$13,336
$75,000	$17,522	$17,533	$13,944	$20,107
$100,000	$25,077	$25,087	$20,323	$29,315
$150,000	$41,690	$41,701	$34,134	$49,285
$200,000	$58,884	$58,897	$48,729	$68,438
$300,000	$100,490	$100,494	$80,567	$108,149

Single filer, no other income, revenue taken as 1.5 times profit, default salary. The lowest cost in each row is marked.

State fees and taxes in Indiana

	LLC	Corporation
Filing to form	$95Articles of Organization (State Form 49459)	$95Articles of Incorporation (State Form 4159)	in.gov
Yearly report	Business Entity Report, $31 every two years	Business Entity Report, $31 every two years	in.gov
Report due	End of the anniversary month of formation, every other year	End of the anniversary month of incorporation, every other year

Indiana taxes personal income at a flat 2.95% (2026). in.gov
C corporations pay 4.9% of net income. in.gov
Indiana follows the federal S corp election.
New employers pay state unemployment tax of 2.5% on the first $9,500 of each employee's wages. That applies to an owner's salary from an S or C corp. in.gov
Online fee is the $75 statutory electronic fee (IC 23-0.5-9-19) plus a $20 enhanced access fee. Paper filing is $100. Report is $31 online or $50 by mail every two years.
Online fee is the $75 statutory electronic fee (IC 23-0.5-9-1) plus a $20 enhanced access fee. Paper filing is $100.

Not in the calculator: All 92 Indiana counties levy a local income tax on residents, roughly 0.5% to 3% on top of the state rate, set by county of residence on January 1 (Departmental Notice 1, https://www.in.gov/dor/files/dn01.pdf). Not modelled.

Switching calculators for Indiana

By profession in Indiana

Questions

Is an S corp worth it in Indiana?

On these figures, from about $50,000 of profit. At $100,000 an LLC taxed as an S corp costs $20,323 a year against $25,087 for a plain LLC, $4,764 less. The saving comes from paying Social Security and Medicare tax on a salary instead of on all profit.

How much does an LLC cost per year in Indiana?

The state charges Business Entity Report, $31 every two years. Forming one costs $95.

Does Indiana recognise the S corp election?

Yes. The federal election carries over with no separate state form. S corporations do not pay the corporate adjusted gross income tax. An optional pass-through entity tax election exists and is not modelled.

What income tax does Indiana charge?

Indiana taxes personal income at a flat 2.95% (2026). C corporations pay 4.9% of net income.

Sources checked 2026-10-20. Each figure links to the state or IRS page it comes from.

Other states