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

At $100,000 profit in South Dakota, an LLC taxed as an S corp costs $17,891 a year in tax and fees and an S corporation costs $17,891. On these figures an S corporation does not cost less at any profit up to $500,000.

+$0 a year

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

With these settings the switch does not pay at any profit from $10,000 to $500,000.

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

Item	LLC as S corp	S corp	Change
Annual Reportsdsos.gov, checked Oct 20, 2026	$55	$55	$0
Payroll tax on your salaryirs.gov, 2026 rates	$6,425	$6,425	$0
Payroll service and tax return (estimate)	$1,800	$1,800	$0
Federal income taxirs.gov, 2026 rates	$9,611	$9,611	$0
Yearly cost	$17,891	$17,891	+$0

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	$6,782	$6,782	+$0
$50,000	$9,662	$9,662	+$0
$75,000	$12,062	$12,062	+$0
$100,000	$17,891	$17,891	+$0
$150,000	$30,458	$30,458	+$0
$200,000	$43,784	$43,784	+$0
$300,000	$73,401	$73,401	+$0

Federal and South Dakota 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 South Dakota

File the Articles of Incorporation with the state: $150 (fee).
Federal return each year: Form 1120-S, due March 15, plus your own Form 1040.
State upkeep each year: Annual Report, $55 a year, due 1st day of the anniversary month of incorporation.

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 Articles of Organization and Annual Report, $55 a year, a corporation files Articles of Incorporation and Annual Report, $55 a year.

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 South Dakota?

Nothing. S corporation costs $0 a year more ($17,891 against $17,891).

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

For federal tax, yes. For South Dakota fees and paperwork, no: the LLC pays Annual Report, $55 a year and the corporation Annual Report, $55 a year.

More for South Dakota

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