StructureCost2026

LLC vs S corp for financial advisors (2026)

At $120,000 of profit, an S corp election saves a financial advisor money over a sole proprietorship in 1 of 51 states, with a $84,000 salary. Pick your state for the calculator with these numbers filled in.

StateSole proprietorS corpSaving
District of Columbia$38,989$38,159$830
South Carolina$32,524$32,678+$154
New Hampshire$30,808$31,202+$394
Nebraska$32,832$33,483+$651
Virginia$34,059$34,749+$690
Alabama$33,772$34,472+$700
Louisiana$31,422$32,129+$707
Missouri$32,765$33,478+$713
Mississippi$32,190$32,924+$734
Kansas$33,884$34,628+$744
Maryland$33,405$34,163+$758
West Virginia$32,680$33,451+$771
Arizona$30,855$31,630+$775
Michigan$32,950$33,726+$776
Georgia$33,277$34,056+$779
Iowa$32,087$32,886+$799
New Mexico$32,595$33,394+$799
Arkansas$32,416$33,237+$821
Indiana$31,721$32,552+$831
Kentucky$32,247$33,116+$869
Oklahoma$32,934$33,803+$869
Texas$28,461$29,425+$964
Montana$33,401$34,372+$971
Idaho$33,263$34,258+$995
Utah$33,424$34,433+$1,009
South Dakota$28,461$29,487+$1,026
Florida$28,461$29,495+$1,034
Wisconsin$32,991$34,114+$1,123
Pennsylvania$31,885$33,022+$1,137
North Carolina$32,402$33,567+$1,165
North Dakota$29,355$30,538+$1,183
Delaware$34,639$35,872+$1,233
Illinois$33,837$35,121+$1,284
Maine$34,414$35,757+$1,343
Vermont$33,361$34,781+$1,420
Wyoming$28,461$29,910+$1,449
Alaska$28,496$30,025+$1,529
Minnesota$34,521$36,052+$1,531
Connecticut$33,020$34,575+$1,555
New York$34,001$35,634+$1,633
Ohio$28,461$30,116+$1,655
Colorado$32,660$34,635+$1,975
Nevada$28,601$30,594+$1,993
Massachusetts$33,817$35,904+$2,087
California$34,741$36,951+$2,210
Rhode Island$32,156$34,371+$2,215
Oregon$37,646$40,042+$2,396
Tennessee$28,461$31,185+$2,724
New Jersey$33,375$36,481+$3,106
Washington$34,718$38,869+$4,151
Hawaii$50,122$55,394+$5,272

Yearly federal and state tax and fees at $120,000 profit and $600,000 revenue, single filer, $1,800 a year of payroll and return costs.

Questions

Should a financial advisor form an S corp?

At $120,000 of profit and a $84,000 salary, an LLC taxed as an S corp costs less than a sole proprietorship in 1 of 51 states. The biggest saving is in District of Columbia ($830 a year), and in Hawaii it costs $5,272 more.

What salary should a financial advisor pay themselves?

The IRS expects pay in line with what the work would earn an employee. The median for employees in this job is $105,070 (BLS, May 2025). The figures here use that, capped at 70% of profit. More on reasonable salary.

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