Virginia: what each business structure costs a year

At $100,000 profit, an LLC taxed as an S corp costs $4,975 a year less than a sole proprietorship in Virginia. All figures are 2026 tax and fees.

$4,975 a year

less as an LLC taxed as an S corp than as a sole proprietorship in Virginia, at these numbers. That includes the state's pass-through entity tax election.

Virginia, 2026: $100,000 profit, single filer

Structure

Yearly cost

vs yours

To set up

Sole proprietorship yours

$26,895

Itemized: $26,895

Self-employment taxirs.gov, 2026 rates	$14,130
Federal income taxirs.gov, 2026 rates	$8,235
State income taxlaw.lis.virginia.gov, checked Oct 23, 2026	$4,530
Yearly cost	$26,895

Single-member LLC

$26,926

+$31

$100

Itemized: $26,926

Annual Registration Feelaw.lis.virginia.gov, checked Oct 23, 2026	$50
Self-employment taxirs.gov, 2026 rates	$14,122
Federal income taxirs.gov, 2026 rates	$8,227
State income taxlaw.lis.virginia.gov, checked Oct 23, 2026	$4,527
Yearly cost	$26,926

LLC taxed as an S corp lowest

$21,920

−$4,975

$100

Itemized: $21,920

Annual Registration Feelaw.lis.virginia.gov, checked Oct 23, 2026	$50
Payroll tax on your salaryirs.gov, 2026 rates	$6,362
Payroll service and tax return (estimate)	$1,800
Virginia pass-through entity tax, paid by the company (elected)tax.virginia.gov, checked Oct 23, 2026	$3,154
Federal income taxirs.gov, 2026 rates	$9,068
State income tax, after the PTET creditlaw.lis.virginia.gov, checked Oct 23, 2026	$1,486
Yearly cost	$21,920

S corporation

$21,920

−$4,975

$75

Itemized: $21,920

Annual Report and Annual Registration Feelaw.lis.virginia.gov, checked Oct 23, 2026	$50
Payroll tax on your salaryirs.gov, 2026 rates	$6,362
Payroll service and tax return (estimate)	$1,800
Virginia pass-through entity tax, paid by the company (elected)tax.virginia.gov, checked Oct 23, 2026	$3,154
Federal income taxirs.gov, 2026 rates	$9,068
State income tax, after the PTET creditlaw.lis.virginia.gov, checked Oct 23, 2026	$1,486
Yearly cost	$21,920

C corporation

$31,173

+$4,278

$75

Itemized: $31,173

Annual Report and Annual Registration Feelaw.lis.virginia.gov, checked Oct 23, 2026	$50
Payroll tax on your salaryirs.gov, 2026 rates	$6,362
Payroll service and tax return (estimate)	$2,000
State corporate income taxlaw.lis.virginia.gov, checked Oct 23, 2026	$3,279
Federal corporate income tax (21%)irs.gov, 2026 rates	$10,788
Federal income taxirs.gov, 2026 rates	$4,875
State income taxlaw.lis.virginia.gov, checked Oct 23, 2026	$3,819
Yearly cost	$31,173

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.

When an S corp election pays in Virginia

Electing S corp tax treatment for an LLC starts to pay in Virginia at about $50,000 of profit, with the default salary and $1,800 a year for payroll and the extra tax return.

An S corp in Virginia can elect to pay the state's income tax itself, a pass-through entity tax of 5.75%, and the owner gets a credit for it. The company deducts it on the federal return, so it is not held to the SALT cap. The calculator uses it when it lowers the totaltax.virginia.gov.

Profit	Sole prop	LLC	LLC as S corp	C corp
$30,000	$5,970	$6,007	$7,399	$7,892
$50,000	$11,590	$11,626	$11,324	$13,839
$75,000	$18,689	$18,724	$15,023	$21,342
$100,000	$26,895	$26,926	$21,920	$31,173
$150,000	$44,809	$44,841	$36,910	$52,497
$200,000	$63,304	$63,341	$52,709	$73,005
$300,000	$107,672	$107,687	$86,655	$115,371

Single filer, no other income, revenue taken as 1.5 times profit, default salary. The lowest cost in each row is marked.

State fees and taxes in Virginia

	LLC	Corporation
Filing to form	$100Articles of Organization (Form LLC-1011)	$75Articles of Incorporation (Form SCC619)	law.lis.virginia.gov
Yearly report	Annual Registration Fee, $50 a year	Annual Report and Annual Registration Fee, $50 a year	law.lis.virginia.gov
Report due	Last day of the anniversary month of formation	Last day of the anniversary month of incorporation

Virginia taxes personal income in 4 brackets, from 2% to 5.75% (2026, single filer). law.lis.virginia.gov
C corporations pay 6% of net income. law.lis.virginia.gov
Virginia follows the federal S corp election.
New employers pay state unemployment tax of 2.5% on the first $8,000 of each employee's wages. That applies to an owner's salary from an S or C corp. law.lis.virginia.gov
Virginia LLCs pay a yearly registration fee to the State Corporation Commission instead of filing an annual report.
Formation is a $25 filing fee (Code 13.1-616) plus a charter fee of $50 per 25,000 authorized shares, so $75 for up to 25,000 shares. Annual registration fee is $50 for up to 5,000 authorized shares plus $15 per extra 5,000 shares, max $850.

Not in the calculator: Most Virginia cities and counties charge a BPOL business license tax on gross receipts (rates vary by locality and business type), and many charge business tangible personal property tax.

Switching calculators for Virginia

By profession in Virginia

Questions

Is an S corp worth it in Virginia?

On these figures, from about $50,000 of profit. At $100,000 an LLC taxed as an S corp costs $21,920 a year against $26,926 for a plain LLC, $5,006 less. The saving comes from paying Social Security and Medicare tax on a salary instead of on all profit.

How much does an LLC cost per year in Virginia?

The state charges Annual Registration Fee, $50 a year. Forming one costs $100.

Does Virginia recognise the S corp election?

Yes. The federal election carries over with no separate state form. Virginia follows the federal S election; S corps file Form 502.

What income tax does Virginia charge?

Virginia taxes personal income in 4 brackets, from 2% to 5.75% (2026, single filer). C corporations pay 6% of net income.

How this page models Virginia (1)

The page uses Virginia's 2.5% new-employer base rate (Code 60.2-526; VEC: 'New Virginia employers receive the initial base tax rate of 2.5% (plus add-ons)') and leaves out the add-ons, because the 0.2% fund building charge applies only in years when the July 1 fund balance factor is 50% or less (Code 60.2-533(C)) and the pool cost charge changes each year, and VEC prints neither for 2026 on any public page, only on each employer's rate notice.

Sources checked 2026-10-23. Each figure links to the state or IRS page it comes from.

Other states