Compare the costs and benefits of forming an LLC versus operating as a Sole Proprietorship in Texas, California, and Florida.
Texas has no state income tax and no annual LLC fee, but does have a $300 formation fee. Franchise tax only applies to businesses with revenue over $2.47 million.
Net Profit: $80,000 (80.0% margin)
Recommended at your income level
At your income level, S-Corp election can provide significant tax savings.
At your income level, forming an LLC with S-Corp election could provide significant tax savings. The self-employment tax savings typically outweigh the additional costs and complexity.
Texas has no state income tax, making it favorable for business owners.
Try enabling the S-Corp option above to see potential tax savings.
Note: Without S-Corp election, an LLC is taxed identically to a Sole Proprietorship at the federal level. The only differences are state fees and liability protection.
This calculator provides estimates based on simplified tax calculations. Consult with a tax professional for advice specific to your situation.
Shields personal assets from business debts and lawsuits
Option to elect S-Corp taxation to save on self-employment taxes
Enhanced professional image and easier to attract investors
This calculator is for educational purposes only. Tax laws change frequently and vary by location.
Always consult with a qualified tax professional before making business decisions.