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C-Corp vs. S-Corp Tax Calculator

C-Corp or S-Corp? This calculator compares both structures side-by-side — including double taxation, QBI deduction eligibility, and the optimal salary/distribution split.

C-Corp vs. S-Corp Tax Calculator

Compare the total tax impact of C-Corp double taxation vs. S-Corp pass through taxation

🏢S-Corp Total Tax
$63,662
31.8% effective
🏛️C-Corp Total Tax
$53,757
26.9% effective
⚖️Difference
$9,905
C-Corp is cheaper
S-Corp Breakdown (Pass Through)
Gross Income$200,000
FICA on Salary$30,600
Federal Income Tax$33,062
Total Tax$63,662
Effective Rate31.8%
C-Corp Breakdown (Double Taxation)
Corporate Taxable Income$84,700
Corporate Tax (21%)$17,787
Personal Tax on Salary$13,170
FICA on Salary (Employee)$15,300
Tax on Dividends (15%)$7,500
Total Tax$53,757
Effective Rate26.9%

C-Corp saves $9,905 at this income level, typically when retaining significant earnings and paying low dividends.

Disclaimer: S-Corp is pass through: all income taxed once at personal rates. C-Corp faces double taxation: 21% corporate tax + personal tax on salary and dividends. Dividend tax assumes qualified dividends at 15%. Does not include state taxes, QBI deduction, or additional Medicare taxes. Consult a tax advisor for entity selection.

Frequently Asked Questions

What is the difference between C-Corp and S-Corp taxation?+

C-Corp: 21% flat corporate tax on profits, then personal tax on dividends (double taxation). S-Corp: pass-through — profits taxed once on your personal return. S-Corp saves most solopreneurs money. C-Corp can work if you retain most profits in the business.

When does a C-Corp make more sense than an S-Corp?+

C-Corp benefits: (1) You reinvest most profits (21% rate vs up to 37% personal). (2) You want to offer stock options. (3) You're seeking venture capital. (4) You have employees and want fringe benefit deductions. Most solo businesses are better off with S-Corp.

What is the double taxation problem with C-Corps?+

C-Corp profits are taxed at 21% corporate rate. When distributed as dividends, they're taxed again at 15-20% personal rate. Combined rate: ~33-37%. S-Corp profits are taxed once at personal rates (10-37%) with no corporate layer. That's why S-Corp wins for most small businesses.

What is the difference between C-Corp and S-Corp taxation?

C-Corp: 21% flat corporate tax on profits, then personal tax on dividends (double taxation). S-Corp: pass-through — profits taxed once on your personal return. S-Corp saves most solopreneurs money. C-Corp can work if you retain most profits in the business.