StructureCost2026

LLC vs S corp for lawyers (2026)

At $180,000 of profit, an S corp election saves a lawyer money over a sole proprietorship in 2 of 51 states, with a $126,000 salary. Pick your state for the calculator with these numbers filled in.

StateSole proprietorS corpSaving
New Hampshire$52,415$51,093$1,322
District of Columbia$64,312$63,058$1,254
South Carolina$54,026$54,240+$214
Maryland$54,906$55,860+$954
Nebraska$53,966$54,948+$982
Virginia$55,863$56,854+$991
Alabama$55,157$56,176+$1,019
Missouri$53,983$55,022+$1,039
Kansas$55,593$56,641+$1,048
Mississippi$53,017$54,066+$1,049
Louisiana$51,691$52,765+$1,074
New Mexico$53,924$55,009+$1,085
Georgia$54,657$55,755+$1,098
West Virginia$53,830$54,930+$1,100
Michigan$53,917$55,029+$1,112
Arizona$50,846$51,999+$1,153
Iowa$52,803$53,970+$1,167
Arkansas$53,076$54,245+$1,169
Indiana$51,963$53,159+$1,196
Oklahoma$54,040$55,237+$1,197
Kentucky$52,795$54,016+$1,221
Montana$55,149$56,418+$1,269
Idaho$54,816$56,118+$1,302
Utah$54,502$55,838+$1,336
Texas$47,058$48,454+$1,396
South Dakota$47,058$48,515+$1,457
Florida$47,058$48,523+$1,465
North Carolina$53,224$54,723+$1,499
Wisconsin$54,544$56,150+$1,606
Pennsylvania$52,194$53,822+$1,628
North Dakota$49,039$50,670+$1,631
Delaware$56,915$58,642+$1,727
Illinois$55,194$56,959+$1,765
New York$55,887$57,731+$1,844
Wyoming$47,058$48,929+$1,871
Maine$56,998$58,925+$1,927
Alaska$47,092$49,047+$1,955
Minnesota$57,357$59,377+$2,020
Vermont$55,985$58,051+$2,066
Connecticut$54,945$57,096+$2,151
Nevada$47,195$49,600+$2,405
Ohio$47,058$49,490+$2,432
Colorado$53,710$56,328+$2,618
Massachusetts$55,202$57,860+$2,658
Rhode Island$53,402$56,157+$2,755
California$58,523$61,490+$2,967
Oregon$61,574$64,579+$3,005
New Jersey$55,524$58,798+$3,274
Tennessee$47,058$50,956+$3,898
Hawaii$67,243$71,475+$4,232
Washington$50,915$55,629+$4,714

Yearly federal and state tax and fees at $180,000 profit and $378,000 revenue, single filer, $1,800 a year of payroll and return costs.

Questions

Should a lawyer form an S corp?

At $180,000 of profit and a $126,000 salary, an LLC taxed as an S corp costs less than a sole proprietorship in 2 of 51 states. The biggest saving is in New Hampshire ($1,322 a year), and in Washington it costs $4,714 more.

What salary should a lawyer pay themselves?

The IRS expects pay in line with what the work would earn an employee. The median for employees in this job is $159,670 (BLS, May 2025). The figures here use that, capped at 70% of profit. More on reasonable salary.

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