StructureCost2026

LLC vs S corp in Rhode Island: which costs less (2026)

At $100,000 profit in Rhode Island, a single-member LLC costs $25,530 a year in tax and fees and an LLC taxed as an S corp costs $21,426. An LLC taxed as an S corp starts to cost less from about $52,500 of profit.

More settings revenue, salary, filing status, payroll costs, PTET

$4,104 a year

saved by switching from a single-member LLC to an LLC taxed as an S corp in Rhode Island, at these numbers.

Switching from a single-member LLC to an LLC taxed as an S corp starts to pay at about $52,500 of profit, with the same settings. As an LLC taxed as an S corp this uses the state's pass-through entity tax election, which lowers the cost here.

Rhode Island, 2026: $100,000 profit, single filer

ItemLLCLLC as S corpChange
Annual Report (Form 632)docs.sos.ri.gov, checked Oct 23, 2026$50$50$0
Rhode Island LLC annual chargetax.ri.gov, checked Oct 23, 2026$400$0−$400
Self-employment taxirs.gov, 2026 rates$14,066$0−$14,066
Federal income taxirs.gov, 2026 rates$8,161$8,950+$789
State income taxtax.ri.gov, checked Oct 23, 2026$2,853$0−$2,853
Payroll tax on your salaryirs.gov, 2026 rates$0$6,535+$6,535
State disability and paid leavedlt.ri.gov, checked Oct 23, 2026$0$440+$440
Payroll service and tax return (estimate)$0$1,800+$1,800
Rhode Island S corporation minimum taxtax.ri.gov, checked Oct 23, 2026$0$400+$400
Rhode Island pass-through entity tax, paid by the company (elected)web.archive.org, checked Oct 23, 2026$0$3,251+$3,251
Yearly cost$25,530$21,426−$4,104
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

ProfitLLCLLC as S corpDifference
$30,000$5,947$7,777+$1,830
$50,000$11,188$11,513+$325
$75,000$17,823$14,850−$2,973
$100,000$25,530$21,426−$4,104
$150,000$42,921$36,248−$6,673
$200,000$60,967$51,940−$9,027
$300,000$105,189$86,448−$18,741

Federal and Rhode Island 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 Rhode Island

  1. 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
  2. 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.
  3. Register with Rhode Island 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 Rhode Island unemployment tax at 1% on the first $30,800 of wages. dlt.ri.gov See what payroll costs.
  4. Federal return each year: Form 1120-S, due March 15, plus your own Form 1040.
  5. State upkeep each year: Annual Report (Form 632), $50 a year, due Between February 1 and May 1. New for you: Rhode Island S corporation minimum tax.

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 Rhode Island unemployment tax on the salary, and Rhode Island S corporation minimum tax. 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 Rhode Island?

About $52,500 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 Rhode Island?

$4,104 a year: Single-member LLC $25,530, LLC taxed as an S corp $21,426.

Does Rhode Island recognise the S corp election?

Yes. No separate state form is needed.

More for Rhode Island

Common cases in Rhode Island

Other states