LLC taxed as S corp vs S corporation in Iowa: which costs less (2026)

At $100,000 profit in Iowa, an LLC taxed as an S corp costs $20,515 a year in tax and fees and an S corporation costs $20,527. On these figures an S corporation does not cost less at any profit up to $500,000.

+$12 a year

more for an S corporation than an LLC taxed as an S corp in Iowa, at these numbers.

With these settings the switch does not pay at any profit from $10,000 to $500,000. As an S corporation this uses the state's pass-through entity tax election, which lowers the cost here.

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

Item	LLC as S corp	S corp	Change
Biennial Reportlegis.iowa.gov, checked Oct 23, 2026	$15	$30	+$15
Payroll tax on your salaryirs.gov, 2026 rates	$6,366	$6,366	$0
Payroll service and tax return (estimate)	$1,800	$1,800	$0
Iowa pass-through entity tax, paid by the company (elected)legis.iowa.gov, checked Oct 23, 2026	$2,085	$2,085	$0
Federal income taxirs.gov, 2026 rates	$9,262	$9,259	−$3
State income tax, after the PTET creditrevenue.iowa.gov, checked Oct 23, 2026	$987	$987	$0
Yearly cost	$20,515	$20,527	+$12

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 as S corp	S corp	Difference
$30,000	$7,068	$7,081	+$13
$50,000	$10,661	$10,674	+$13
$75,000	$13,956	$13,969	+$13
$100,000	$20,515	$20,527	+$12
$150,000	$34,726	$34,738	+$12
$200,000	$49,727	$49,740	+$13
$300,000	$82,291	$82,301	+$10

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

What the switch takes in Iowa

File the Articles of Incorporation with the state: $50 (fee).
Federal return each year: Form 1120-S, due March 15, plus your own Form 1040.
State upkeep each year: Biennial Report, $60 every two years, due January 1 to April 1 of even-numbered years.

What changes between the two

Both are taxed the same way by the IRS once the election is made: salary with payroll tax, the rest as a distribution, one Form 1120-S. The difference is state law: an LLC files Certificate of Organization and Biennial Report, $30 every two years, a corporation files Articles of Incorporation and Biennial Report, $60 every two years.

A corporation also has formalities an LLC skips: a board, bylaws, share records and yearly minutes. Most one-person businesses pick the LLC route for that reason.

Questions

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

Nothing. S corporation costs $12 a year more ($20,527 against $20,515).

Is an LLC taxed as an S corp the same as an S corp?

For federal tax, yes. For Iowa fees and paperwork, no: the LLC pays Biennial Report, $30 every two years and the corporation Biennial Report, $60 every two years.

More for Iowa

Common cases in Iowa

Other states