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

At $100,000 profit in North Dakota, a single-member LLC costs $22,930 a year in tax and fees and an LLC taxed as an S corp costs $18,565. An LLC taxed as an S corp starts to cost less from about $50,000 of profit.

$4,365 a year

saved by switching from a single-member LLC to an LLC taxed as an S corp in North Dakota, 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.

North Dakota, 2026: $100,000 profit, single filer

Item	LLC	LLC as S corp	Change
Annual Reportsos.nd.gov, checked Oct 20, 2026	$50	$50	$0
Self-employment taxirs.gov, 2026 rates	$14,122	$0	−$14,122
Federal income taxirs.gov, 2026 rates	$8,227	$9,588	+$1,361
State income taxtax.nd.gov, checked Oct 20, 2026	$531	$565	+$34
Payroll tax on your salaryirs.gov, 2026 rates	$0	$6,562	+$6,562
Payroll service and tax return (estimate)	$0	$1,800	+$1,800
Yearly cost	$22,930	$18,565	−$4,365

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	$5,221	$6,757	+$1,536
$50,000	$9,771	$9,691	−$80
$75,000	$15,611	$12,185	−$3,426
$100,000	$22,930	$18,565	−$4,365
$150,000	$39,079	$32,127	−$6,952
$200,000	$55,813	$46,398	−$9,415
$300,000	$96,509	$78,013	−$18,496

Federal and North Dakota 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 North Dakota

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 North Dakota 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 North Dakota unemployment tax at 1% on the first $46,600 of wages. jobsnd.com 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, $50 a year, due November 15.

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 North Dakota 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 North Dakota?

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 North Dakota?

$4,365 a year: Single-member LLC $22,930, LLC taxed as an S corp $18,565.

Does North Dakota recognise the S corp election?

Yes. No separate state form is needed.

More for North Dakota

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